E- Signatures: What They Are, Types, and Benefits
An eSignature, commonly referred to as an electronic signature, is a signature in electronic form. It consists of various methods of attaching identity to a document online. For example, an electronic signature can be a simple picture of a handwritten signature. Other times it can be as complex as a digital signature certificate generated via PKI.
Electronic signatures allow people to sign legally binding contracts without needing a pen or paper. For this reason, eSignatures have rapidly grown in popularity over recent years. Electronic signatures are also more convenient than traditional signatures since they save on time and postage; they render the recipient's location irrelevant since they can be used to sign documents remotely.
It is easy to see why an eSignature has become a must-have for many businesses, consumers, and even some government processes. Different types of electronic signatures can be used depending on the specific use case; each offers an extra level of authentication of the identity attached. Electronic signatures allow signatories to approve or agree with a document's terms; therefore, jurisdictions may consider eSignatures equivalent to their ink-based ancestors.
Types of electronic signatures
There are three types or categories of eSignatures as defined by the eIDAS regulations – simple electronic signature, advanced electronic signature, and qualified electronic signature. Each level has different requirements; the qualified electronic signature meets the most conditions, and a simple eSignature meets the least.
Simple electronic signature
Simple eSignatures are the broadest and most specific types of electronic signatures. They are data in electronic form, which is attached to or legally associated with other data in electronic form, and the signatory uses it to sign. Simple electronic signatures need no identity verification from the signer, meaning it may be challenging to get the signee's name in case of fraudulent activity. They, therefore, are not the most preferred type of eSignature when security is a priority. For simple electronic signatures, trust is the responsibility of the individual accepting the document.
Simple electronic signatures can be legally binding, but higher qualifications must be met for many documents.
Advanced electronic signature
Advanced electronic signatures are more secure than simple eSignatures since they require a level of identity verification. For this eSignature, the proof is based on certificates uniquely identifying the document's signer. Advanced electronic signatures are transmitted through a unique delivery service that offers audit trails and other evidence about the transmitted data. A Certificate Authority usually certifies these signatures.
Qualified electronic signature
A qualified electronic signature is like an advanced eSignature, but it goes further to meet additional requirements as in the eIDAS regulations. For example, advanced eSignatures are created by a qualified signature creation device based on a qualified certificate for electronic signatures. Identification of the signatory by an audited entity, such as a certificate authority, can be completed remotely via video chat or in person.
Although different types of electronic signatures may be appropriate depending on the context, only qualified electronic signatures are explicitly recognized as having the same legal effect as handwritten or ink-based signatures.
Benefits of electronic signatures
Instant and convenient
Electronic signatures eliminate idle periods from the process, accelerating approvals and agreements. The signing process is almost as fast as wet ink, but time is saved, especially in document handling. It becomes easier and faster to manage affairs when you no longer need to scan o print documents and send them as paper mail. Electronic records can be saved where the right individuals can access them if needed. Sending an electronic document to the recipient only takes a moment, and you can sign or request signatures from anywhere worldwide.
An environmentally friendly choice
Besides being time-consuming and annoying, having to print, scan, and fax is also bad for the environment. With every appliance you purchase, you enlarge the overall carbon footprint. The more appliances or devices you eliminate from the equation, the better your workflow for the plant. That also applies to the trees that need to be cut down to process paper for hardcopy documents. Using electronic signatures also saves you the need to find storage space. There are various digital workspaces that you can use to store your document safely and for an extended period.
If you are looking to accelerate your processes, electronic signatures are what you may need to introduce. You can use eSignatures everywhere, but everyday use cases include purchase orders, sales contracts, real estate contracts, vendor contracts, employee contracts, and non-disclosure agreements.
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