Thanks to technology, the way we do business is no longer the same. Many organizations have adopted the hybrid work model, especially after the Coronavirus pandemic, to keep their workers safe.
This also led to businesses facing many challenges, such as signing documents without meeting in person. Electronic signature technology has become a fundamental component in accelerating business processes and reshaping the technological environment.
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What Is An Electronic Signature?
An electronic signature, or e-signature, is the electronic proof of accepting an agreement or record. It is a legal way of getting approval on electronic documents using single-factor authorization with variables like unique PINs, passwords, and security numbers to verify identity.
In other words, the digital signature process replaces a handwritten signature virtually. The benefits of electronic signatures can be compared to the importance of email in our daily life. Like email, the digital signature process enables us to take the business operation to a whole new level.
The global digital signature market was valued at US$ 879.6 Mn in 2018 and is estimated to reach US$ 6,128.0 Mn by the end of 2026. It is growing at a CAGR of 28.77% during the forecast period (2019-2026).
The Digital Signature Process Explained
E-signatures are just like handwritten signatures — unique to each signer. It can be achieved through any digital device, as it is composed of a series of encrypted data called keys. There are two keys — one is private, and the other one is public.
When a person signs a document electronically, a signature is created using the private key. It is securely kept by the signer. Then a mathematical algorithm is put into a role that creates data matching the signed document (a hash) and encrypting those data.
The encrypted data is the ultimate digital signature. The signature is marked with the time when the document was signed. In case the document changes after signing it, the e-signature is considered invalid.
The whole digital signature process consists of the identity verification of the signer, followed by the signature registration and contractual acceptance.
To give you an example, Mr. X signs an agreement to sell a share using her private key. The buyer receives the document along with a copy of Mr. X’s public key.
If the public key can’t decrypt the signature, it means the signature isn’t Mr. X’s. Or, it could be that it might have been since it was signed. Then, the signature becomes invalid.
The Benefits of Digital Signature Across Software Solutions
Improves Time Management
The first and foremost thing is that e-signature saves time. It takes only 45 seconds to sign a document electronically, and it can save five days on average (annually) for companies. Thus companies has great use of Electronic signature software’s in business uses.
E-signing simplifies the workflow as it enables multiple parties to sign a document simultaneously, without scanning or printing it. Thus, the waiting periods between drafting and passing the documents to different personnel for signing are drastically reduced.
You can sign the document electronically in a moment and send it back right away. It results in speeding up the whole implementation process.
Saves Paper Costs
According to World Counts, 50% of company waste is paper. Moreover, 45% of the printed paper at the office ends up in the trash. Imagine the amount of paper you can save in terms of both waste and costs.
By switching electronic signing, you can save in paper storing, postage, mailing, archiving, and paper handling. It removes the need to print paper.
The less the paper is used, the more the plants are saved. So, it is an environment-friendly choice too.
Provides High Security
Despite all the security concerns revolving around e-signature, it is in fact, more secure than the paper one.
Electronic signature relies on encryption technology called hash signing. It ensures full confidentiality and security of the document. Whereas a paper document can be easily destroyed, misplaced, and left unattended. In fact, the signature can also be forged in many cases. This poses high-security threats with legal implications.
Besides, e-signature records with full time and date of the signing event. It provides users with an extra level of security in case of litigation.
In the traditional paper signing method, the process of print, sign, scan, and send needs to be repeated every single time.
However, in the case of e-signing, the process is simplified. It cuts down on steps like scanning, printing, or mailing. Fewer steps mean getting work done faster, and it also results in fewer mistakes.
Furthermore, a faster turnaround leads to an enhanced experience for the client, leaving no reasons for them to abandon before the signing process. Digital signature makes it possible for entrepreneurs to improve the speed and efficiency of their business transactions.
Convenient and Easy to Use
Today, organizations are looking for digital solutions that establish connections between different stakeholders sitting in different parts of the world. Most of the businesses are done remotely.
Using an electronic signature makes physical distance no longer an obstacle and enables organizations to get the documents or contract approved easily. E-sign is available from anywhere in the world, optimizing various business processes.
Different Usage of Electronic Signature
In the banking sector, the usage of electronic signatures has made the whole process of onboarding a new customer easy. Banks are able to provide a user-friendly experience to their customers with the increased use of digital capabilities. There is also difference in electronic signature and digital signature.
Similarly, companies in other industries are using a digital signature to fasten the process of closing a deal or onboarding a new client. It gives them an edge over competitors by allowing them to create an enhanced customer experience.
Reducing human errors, speeding up the process, and enhancing efficiency are some of the most obvious advantages of executing electronic signatures.
As a business owner, you need to understand that e-signature is here to stay, and the sooner you implement it, the higher the competitive edge over others.