Although virtualization of business processes was first motivated by need, progressive organisations are now able to use this shift to their benefit.
Many businesses are still unsure of their alternatives when it comes to electronic signatures on forms, despite the fact that tools like Zoom and Google Meet kept teams engaged during the epidemic and cloud storage solutions have permitted the transmission of information in real-time.
Onboarding new customers, hiring new employees, and executing new contracts all still relied heavily on the old-fashioned practice of printing, signing, and scanning paper documents.
If businesses are serious about digitising all of their workflows, however, the capacity to generate legally binding electronic signatures is a must. Read on to find out all there is to know about the differences between electronic signatures, digital signatures, and wet signatures.
How to Create Signatures Online
According to a recent poll conducted by McKinsey and Company, the top goal for service firms is to alter their current operating models. These business models are used in businesses that have stringent regulations and rely on the formation of legally binding agreements across locations, amongst several stakeholders, and in the absence of frequent in-person meetings.
Wet Signatures vs. E-Signatures vs. Digital Signatures
Wet signatures, e-signatures, and digital signatures are all alternatives to traditional handwritten signatures that have been widely accepted in recent years.
Wet Signatures –
Conventional handwritten signatures, when an individual signs a document using wet ink and then either mails or scans the hard copy to the business.
E-Signatures –
Any action, such as clicking a mouse or verbally authorising a transaction, counts as an electronic signature.
Digital Signatures –
A special feature on a form that can only be found on that form, and which, when combined with the accompanying certificate, guarantees the legitimacy of the form and its contents.
The following explanations make it obvious that electronic signatures and digital signatures are different concepts, despite their frequent interchangeability.
In order to confirm the validity and invulnerability of a document, a digital signature will attach a digital certificate that has been encrypted and then bonded to the document. After a digital signature is applied, only authorised individuals will be able to read the form and make any necessary modifications.
What Types of Signatures are Legally Binding?
All three signatures are legally binding from a technical standpoint, however wet signatures can’t be used in digital processes. The signing process takes longer and requires more effort when there are more parties to obtain their signatures. Businesses and financial institutions that are considering a full transition to digital processes should be familiar with the key distinctions between digital signature vs esignature.
Which Signature Should You Use in Highly Regulated Industries?
Although e-signatures have the same legal weight as traditional signatures, they raise several red flags when applied to highly regulated sectors. E-signatures lack the physical security measures required by government agencies to ensure the privacy and security of sensitive financial, banking, and medical information.
Electronic signatures may provide certain challenges in highly regulated businesses.
- Authenticity – No trusted authority verifies or validates the signature
- Security – They are vulnerable to tampering, alteration, and fraudulent practices
- Authority – Fewer security features that don’t incorporate any coding or standards
For this reason, if you need to sign legally binding, verifiable, and secure forms online, you should use digital signatures or an electronic document signing software that does.
