Electronic signatures are a type of signature that is electronically captured and stored, as opposed to the more traditional pen-to-paper method. Electronic signatures date back to at least 1984, when they were first standardized by the United States government for use in electronic commerce. The first patents for an electronic signature capture system were filed in 1985.
The benefits of using an electronic signature are that it saves time and money, reduces fraud, and improves security. However, there are also some drawbacks to using them. For example, it’s possible for someone to clip their finger onto someone else’s fingerprint scanner so they can digitally sign documents as the other person. Here are the basics of what you should know about electronic signatures before deciding if they’re right for you
Electronic signature basics
Types of electronic signatures
There are different types of electronic signatures, with varying advantages and disadvantages.
Public-key electronic signature is considered the gold standard in electronic signature capture. These signatures are created using public key cryptography and are signed with two different types of keys. One key is private, and anyone can check the signature against it to verify that it’s real. The second key is public and is used only to identify the individual. It is unique and can’t be copied.
Advanced public key is the most widely used and most secure method for capturing signatures. The key is public and is available for public use.
Benefits of e-signatures
Faster transactions
An electronic signature can be more convenient for both businesses and their customers. After all, when you have to print out physical documents, you have to be there in person for every single transaction. However, with an electronic signature, you can sign documents from anywhere there is a high-speed Internet connection.
Better security
The best way to ensure that you’re protected against fraud is to get your documents signed electronically. Having to deal with people with thick, untampered-with wads of cash is risky when you’re trying to conduct business over the phone, especially since the recipient has no idea if the information is correct.
Drawbacks of electronic signatures
Electronic signatures may not be legally binding. They are typically only stored in the cloud and not saved on a person’s hard drive. Since they’re rarely stored on a person’s hard drive, they are often overlooked when people are deciding whether to take action in a legal matter. That said, some courts require signatures to be digitally signed in order for a document to be considered official. The good news is that in some states (for example California and Maryland), you do not need a digital signature, and it is the signature on the document that matters. Other states may require a signature with a digital signer in order for the document to be considered official.
Electronic signatures are time-consuming. When signing an electronic signature, it typically takes more than one minute.
How to get an e-signature?
Getting an e-signature could mean more responsibility for you as a business owner, but it’s also just another tool to help you run your business effectively. And that’s why getting an e-signature makes a lot of sense. Here’s how it works.
As a business owner, you should first look into signing up for one of the many companies that provide digital signatures. This is the most common type of digital signature.
When a customer places an order with you online or over the phone, you are asked to fill out an electronic signature form. It could be attached to an email, on the back of a receipt, or an attached document. They are usually handwritten and look like this:
