Digital Signatures 101

What is a Digital Signature?

 

A digital signature is simply an electronic version of a physical signature. It is a form of identity authentication on an electronic version of a contract or legal agreement. In addition, a digital signature is automatically time stamped. This permanently alters the document it has been embedded onto.

They can be used on virtually any electronic device with a screen. Laptops, tablets, smartphones – whatever.

Use of digital signatures has grown exponentially over the last few years. Companies are continuing to take advantage of their financial and environmental advantages. Most companies and governments have realized how useful digital signatures are in a fast paced, globalized economy. The workflow advantages of using electronic documents greatly enhances their value as transactions can be completed quickly and efficiently.

Woman examining digital signature contract on tablet
Woman working on product to import to digital contract

Can you trust a Digital Signature?

 

Yes. Just like a physical signature, a digital signature is a binding confirmation of what is written on a document. It may look different than a regular signature, but signing with your mouse or finger has the same result as signing with a pen.

As with a written signature, a digital signature cannot be imitated or forged by someone else.

Are Digital Signatures Considered Legal in Court?

 

Yes. Digital signatures have had the same legal standing as physical signatures in the United States since 2000, and are valid and legally binding in most countries in the world.

In the United States, digital signatures became legal with the Electronic Signatures in Global and National Commerce (E-SIGN) Act, which validated all electronic contracts. In fact, it’s possible to store all of your records exclusively online, because under the same law that can satisfy the requirement to retaining a record of your transactions. Digital signatures are also covered under the Uniform Electronic Transactions Act.

In Canada, all federal and provincial governments have passed laws recognizing the legitimacy of most types of digital signatures. Digital signatures are covered under the Personal Information Protection and Electronic Documents Act of 2000.

In the European Union, digital signatures fall under EU Regulation No. 910/2014, otherwise known as eIDAS. They are valid and legally binding across the Union, as well as non-EU states like the UK.

Where are Digital Signatures a good fit?

 

Technology is now at a level at which virtually any transaction can be handled digitally. Sales agreements, HR contracts, mortgages, insurance forms – you name it.

The driving principle behind digital signatures is satisfying identity verification, which allows it to be used in place of physical signatures in almost every scenario.

Small business owner using digital signature platform on laptop