TECHNOLOGY

The Importance of E-signatures

If you’ve signed a document online in a situation where you couldn’t be in person, chances are you’ve done an e-signature. With the advent of the pandemic, business deals have now been completed and signed almost entirely through e-signatures, and e-signature providers have seen business sky-rocketing over the past two years. 

Few of us know what an e-signature is or how it works. However, it is necessary to know about it, and this article is for that specific reason. So keep on reading as we tell you all about e-signatures. 

What is an e-signature?

An electronic signature or e-signature is a signature made electronically. It can be as simple as adding your name to a document being circulated in the office. They are usually created uniquely for an individual and serves as a unique identification for him or her. 

E-signatures differ from jurisdiction, but most commonly, they are known legalized if they follow these norms:

  • The signature must be unique to the signatory 
  • The signatory must be the only one with the key that can provide the e-signature
  • If the e-signature has been tampered with, it must automatically invalidate itself. 
  • The e-signature must be able to inform the recipients if tampering has been done to it. 

How does an e-signature work?

There is specialized e-signature software for this. The software is typically used by companies and can be purchased from an e-signature provider. In addition, the software can be seamlessly integrated with the company’s software to make it easier to use it on documents for giving e-signatures. 

E-signature for documents is used mainly in HR, Accounting, Supply chain, and Procurement. They are used for signing contracts, facilitating quotes, and legalizing employment paperwork. By offering a secure form of communication between sender and recipient, it gives the signatories a chance to sign documents on various devices and operating software. 

Difference between e-signature and digital signature 

The main difference between e-signature and digital signature is the use of cryptography in digital signatures. To put it simply, digital signatures are cryptographic implements of e-signatures. In addition, they are considered more secure as they are cryptographically protected. Therefore, Digital signatures are more commonly used in regulatory filings and legally sensitive documents by signatories. 

Their usage comes mainly by companies for software contracts and financial distribution contracts, where it is necessary to trace any tampering or forgery attempt. Most countries recognize digital signatures as being safer, and they have legal significance. 

Features of e-signature

Certain forms must be adhered to for an e-signature to be considered. These are:

  • An e-signature should contain one or more letters, numbers, or other symbols in the digital form attached to an electronic document. 
  • Unique to the signatory 
  • The technological method of creating the e-signature is solely under the control of the signatory. 
  • The signature serves as a unique identification for the signatory only 
  • The e-signature can function as a marker against forgery as it can indicate whether the document has been changed since the attachment of said signature 
  • Allows fellow signatories to track the status of the document 
  • Encrypts the document information to prevent misuse by unauthorized persons 
  • Grants signatories the ability to define roles of users and specific permission rights 

E-signature providers 

Most e-signature providers include document templates and document sharing facilities as additional services. They are also differences between providers, with some being specifically for sales and so on. 

E-signatures have become an integral part of the company’s software roster and are set to overtake physical signatures. In addition, the ease and security of e-signatures have made them a favourite among executives for contracts and legally sensitive document dealings.