The paperless office may still be a long way away, but the digital contract is becoming a reality for an increasing number of businesses. Digital signatures are now being used to protect documents in a variety of fields including life insurance policies, rental agreements, invoices and employment contracts.
In the US, it is estimated that 50% of documents could be being signed electronically before the end of the decade. In Europe, which has been slower to adopt the technology, the market is expected to expand rapidly as new EU eIDAS regulation clarifies the necessary legal framework and allows more flexible technical solutions to be adopted.
So, with this in mind, what are the business benefits of switching to digital signatures?
Cost savings and efficiency improvements
Firstly, there is no longer a need to print the document, copy it, fax/courier/post it, copy it again when returned and then archive it in a filing cabinet. Why wait for a senior manager to return from holiday or a sales conference to approve a deal? Workflow and digital signature approval solutions allow you to upload documents, add signature fields, apply legal notices, send documents to internal or external parties and store and retrieve copies online. They also allow signing on the move from mobile devices.
This makes managing and tracking contracts easier, less time consuming and less stressful. Email notifications inform people when it is their turn to sign and remind them if required. Status tracking means you can see at a glance where the document is in the approval process. Management features allow other staff to prepare and check documents prior to senior staff applying their digital signatures. Most of all, digital and ‘live’ signing improves the user experience and, thanks to cloud-based solutions, is quick, easy and convenient.
Increased security and compliant practices
Another benefit is security. Digital methods provide a clear audit trail to minimise the risk of fraud and compliance issues. Unlike a traditional ink on paper signature, a digital signature is impossible to forge when combined with strong user authentication options and as a result provides strong evidence in court. Signers can authenticate their identity and authorise their signature using PINs, passwords and cryptographic codes and their digital signature includes a trusted timestamp to prove the exact date and time that a document was signed.
Digital solutions also provide clear proof of signer identity and show the document has not changed since it was signed. The most secure solutions embed the signer’s digital certificate to the document itself – binding the signer’s identity to the document and locking it from any unauthorised or fraudulent change.
Digital signatures also ensure document validity well into the future. ETSI PDF Advanced Signatures (PAdES) is a set of standards that support EU Electronic Identification and Trust Services (eIDAS) requirements. These specifications include long-term signature formats, enabling digitally signed documents to remain valid for many years into the future, even if technological and other advances have occurred since signing.
Last but not least, there are environmental sustainability benefits. By switching to digital signatures you are signalling to customers, partners and employees that you care about the environment and reducing waste — and that you are an innovative and forward-looking company.
The business outcomes
Ultimately, digital signatures save time, money and effort; make contracts more secure through the reduced risk of fraud; simplify audit and compliance; and help strengthen your brand. Given that solutions can be easily integrated into existing applications and require relatively little capital outlay, it is an ideal solution for small businesses.
There are caveats though. Not everything that looks like a digital signature solution holds up to legal scrutiny. Some solutions are based on simple e-signatures that do not authenticate the signer and do not cryptographically lock the document against change. Some are much less flexible than others. For example, not all solutions have the option of deploying in-country or in-house to meet national or organisational data protection requirements.
Investing in a document workflow and digital signature approval solution must deliver clear business outcomes – enhanced business processes, an increase in productivity, enhanced data security and document protection and reduced costs.
The final step is to choose to sign on the (digital) dotted line.
By Rod Crook, Solutions Director, SigningHub by Ascertia