Electronic Signature Software Trends
Electronic signature software makes signing and authenticating documents faster and easier.
Instead of emailing a document, downloading it, printing it out, signing it, scanning it, and emailing it back, what if you could sign documents in just a few clicks, and in just a few seconds?
This is exactly what electronic signature software allows you to do, and with added security as well.
Why use electronic signature software?
The biggest reason to use electronic signature software is to speed up the turnaround time for your business’s documents that require signatures. Electronic signature software can help you turn multi-day back-and-forths via email into a few minutes of work.
This kind of software is especially useful when you are trying to coordinate with several different parties on a single document: getting everyone to sign the same document, in the right places, via email can be an utter nightmare.
Ditto for trying to distribute and collect contracts or invoices when you’ve got dozens or hundreds of different variants of the same form, each going to a different person. Electronic signature software can automate this process, saving you an incredible amount of time.
Time efficiency is not the only reason to use electronic signature software, though. One distinct advantage offered by electronic signature tools that use digital signature technology is the ability to verify that a document has not changed, either since you distributed it or since the signature was added.
This digital verification provides security that you can’t get if you are just pasting a signature into a Word document, or printing, signing, and scanning a PDF. Digital verification technology, embedded in digital signatures (not to be confused with the broader category of electronic signatures!) has become the primary standard for distributing important documents that need signatures, like legal contracts or sales agreements.
Electronic signature software also gives you a centralized, cloud-based storage location for all of your signed documents. Another issue with the “print, sign, scan, email” approach to signing documents is the lack of a proper audit trail, and the potential problems that could arise after the document gets sent and stored. What if the hard drive crashes? What if the email account gets deleted because the employee moves to another job? What if the document just gets lost?
With hundreds or thousands of contracts, hiring agreements, or invoices passing through your company every year, these are real possibilities. Worse, you usually won’t discover a document is missing until precisely the moment you need it the most. With electronic signature software, you can just pull up the relevant document and inspect it whenever you need it.
Another area where electronic signature software can save you time is with bulk sending and template options. Often, companies have versions of the same document that will ultimately get sent out many times: a hiring contract, an annual agreement for independent contractors, sales invoices, and so on.
If these only need small changes, using a template in electronic signature software is a great idea to cut down on repetitive tasks like saving the same document over and over with different filenames. Likewise, if the same document (or variants of it) need to be distributed to a large number of people, bulk-sending documents for electronic signatures is a cinch with a good electronic signature software tool.
What if each of these documents needs to be sent to a set of people (maybe a team of contractors)? Not a problem. Imagine what a pain it would be to do all of this by hand—you’d need several spreadsheets just to keep track of which document goes to which group, and whose signatures are still outstanding.
Even if you are not sending out invoices by the thousands, electronic signature software can help you out in a bind if you ever do need to prove the legal validity of a contract or an agreement.
Electronic signatures, especially when implemented as digital signatures, carry a timestamp, a verification of the user who signed it, and a verification that the document was not edited after signing. These verification steps give you an ironclad, legally-admissible defense in case you ever need to defend or dispute a contractual agreement.
Who uses electronic signature software?
Anywhere you would traditionally see signatures and contracts, you’re likely to run into electronic signature software. Some of the biggest users of electronic signature software are people who work in hiring and human resources, as they often send employment agreements to new hires and independent contractors who aren’t physically present.
Moreover, these agreements have to get sent out on a regular basis, often with only small changes (e.g. to the date and to the specifics of the employment agreement). Thus, your human resources team (or whoever is in charge of the administrative side of hiring, if you are a smaller company without a HR department) will be heavy users of your electronic signature software.
Another major application of electronic signature software is in sales and invoicing. You’ll want to make sure your sales and CRM, or customer relations management, teams are up to speed on your electronic signature software.
Sales invoices and agreements are the lifeblood of your company’s revenue stream, so anything you can do to speed up the creation and signing of these documents will directly improve your company’s bottom line. Sales invoicing can make heavy use of document templates, because many sales invoices are more or less identical to one another, save for the date, the customer, the amount, and the specific price being agreed upon.
Document templates are a great way to generate new invoices on demand and with little delay. Setting up automatic alerts to notify you once a document has been signed can also speed up delivery of your products or services.
Anything that your legal team is involved with will also generate a lot of contracts and other documents requiring signatures. Unlike your sales invoices or employment agreements, these documents from your legal team may not be amenable to templates, as the specific wording is likely to change substantially from one document to the next.
However, your legal affairs team will greatly appreciate electronic signature software that offers authenticated digital signatures, due to their increased security and the additional layer of validation that they provide for the documents that are being signed.
Legal documents often have multiple places where signatures are needed, and may also require signatures by several different parties. Again, electronic signature software makes it easy to get signatures from all relevant parties, in all of the relevant subsections of the documents you are sending out.
Many legal applications require additional supporting documentation, which can be easily attached to the primary document that needs to be signed. The electronic signature can therefore also provide proof that the supporting documentation was received by the people who signed your document.
For people at your company who sign many different documents, like members of the leadership team, you’ll want to make sure they set up accounts in your electronic signature software so their signatures on documents are processed as quickly as possible. It’s also a good idea to sign up these key players for two-factor authentication, to provide the highest level of security for your most important signatures.
Features
The best electronic signature software will offer digital signatures, which are not the same thing as an electronic signature. Though the terminology is quite similar, digital signatures have several features that make them a special sub-type of electronic signatures overall.
A digital signature includes a special mathematical function that takes a user’s “key,” which is tied to his or her identity and kept secret, and creates a mathematical signature to accompany the actual signature on the document.
This mathematical signature accomplishes two things: it verifies that the person who signed the document really is the user it was intended for, and it locks the document, ensuring that it was not altered from its original form.
By attempting to validate the mathematical signature against the user’s identity and the original document, you can simultaneously validate both the person signing the document and the document itself. Digital signatures are legally binding and are admissible in court, making them excellent choices for companies involved in high-stakes negotiations.
Especially if you generate a lot of documents to sign, look for cloud-based electronic signature software that stores your signed documents for you. One of the most useful features of a good electronic signature tool isn’t even the signature feature—it’s the ability to pull up any document you’ve ever sent out, determine who signed it, and when.
With modern cloud-based software, you can do this on any device from anywhere in the world as long as you have an internet connection. Pulling up these documents to double-check a number, or to check up on the status of a document is incredibly convenient and can save a huge amount of time, particularly if you have heaps of documents that get signed.
If you work with large teams or send the same document to many different people, look for electronic signature software with bulk-send abilities. If you’re managing many different subcontractors, or are hiring a large team of independent contractors, you could have dozens or hundreds of contracts to send out at a time.
Electronic signature software that offers a high capacity for bulk-sending is a big time-saver in these situations, so if you find yourself in this position a lot, look for bulk-sending capabilities.
Many electronic signature software tools allow you to set up automated notifications and reminders associated with your documents. When dealing with documents that need signatures from several different people, it can be very difficult to keep track of who has signed what.
Higher-end electronic signature software lets you set up alerts, either via email or app notification, when someone (or all parties) have signed a document, so you know you can move on to the next step.
You can also set up an automated reminder email to follow up on a document if it has not been signed after a predetermined amount of time, say a week or two weeks. These automated reminders make following up on documents one fewer thing you have to worry about, giving you more time to spend elsewhere.
If verifying the identity of the people who sign your documents is important to you, look for electronic signature software that uses two-factor authentication. Even with a well-implemented digital signature, there is still one big security vulnerability: the person on the receiving end of the document. If their laptop gets stolen, or their remote account gets hacked, you’d be in real trouble.
Two-factor authentication is the best way to guard against this security vulnerability. You’ve probably used it before, as it’s popular with banks: when you log in, you’ll get a text message or an app notification on your phone with a passcode or PIN. That way, the only way to log in is by knowing your password, and having possession of your phone (which likely has its own password as well).
Two-factor authentication can be a bit annoying, so you may not want to deploy it for everyone, but if you deal with high-stakes documents and you want the highest level of security, it’s well worth pursuing.
One other aspect of two-factor authentication that’s worth mentioning is that it should only be used when you are already using digital signatures. If you aren’t using a digital signature to implement the highest level of security and validation on your documents, there’s usually no point in pursuing two-factor authentication as well. Having a document edited without your knowledge, or not being able to prove the identity of the person who signed the document, are far more likely security threats to your documents, so these should be your top priority.
Capturing the geolocation of the user (i.e. the GPS coordinates) can also guard against forgery, because it provides more evidence that the person who signed your document really is the intended party.
Higher-end electronic signature software, and higher-tier payment plans, offer support for a greater number of users on your account. The number of users available to you won’t affect who you can send out your contracts to—rather, it affects how many different people can draft up contracts, send them out, and review your archive of signed documents.
One of the distinguishing factors for higher-tier payment plans for most electronic signature software is the maximum number of users you can have on your system, so if you have a large team drafting up sales invoices, hiring agreements, or contracts, you’ll need to budget more for your electronic signature software.
FAQ
Q: How do you create an electronic signature?
A: To create an electronic signature, you’ll need a platform to create it on—this is exactly what electronic signature software provides.
To sign a document once, there’s no special setup that’s involved, but if you want to attach a digital signature, you’ll need to create a “key” that uniquely identifies you and store it, either on your computer or in a cloud account.
In most cases, this process can be made virtually seamless with electronic signature software if you’re on the receiving end of a contract or invoice. If you’re the one sending it, you’ll need to get familiar with your electronic signature software and figure out what level of security you want for your documents.
Q: What is the difference between an electronic signature and a digital signature?
A: Electronic signatures are a wide category of technologies that enable you to sign documents without printing them out.
Digital signatures are a specific type of electronic signature that have specific security-enhancing technology to validate both the identity of the person who signed the document and the integrity of the document itself—in short, if you need to make sure a document has not been edited or altered since you sent it out, and you want to verify the identity of the person who signed it, you should specifically use a digital signature.
Q: What kind of electronic signature software is good for PDF files?
A: PDF files are so ubiquitous that you’d be hard-pressed to find any electronic signature software that doesn’t support PDFs. That being said, some of the most popular electronic signature software for PDFs can make preparing and signing them incredibly easy.
These include eSign Genie, DocuSign, and Adobe Sign. These all have tools to let you quickly and easily generate and distribute PDF files that need to be signed.
Q: What are some good alternatives to Adobe for electronic signature?
A: If you aren’t up for the sometimes-steep price tiers of Adobe’s software for signing documents, check out eSign Genius, PandaDoc, or DocuSign—these are just a few of the great alternatives that you can use if you still want secure and easy to use electronic signatures.
Q: Are there any online electronic signature software tools?
A: Many of the best electronic signature software tools, like DocuSign or HelloSign, are completely cloud-based: there is no local software you need to install to use them.
That means they’re totally online, and you can log in to access your documents or create new documents from anywhere with any computer. Because this provides a lot of convenience, online electronic signature software (aka cloud-based electronic signature software) is the best choice for most business applications.
Q: What electronic signature software integrates with an iPad?
A: Any cloud-based electronic signature software should integrate well with an iPad or other Apple device, which provides another advantage to online electronic signature software versus software that you need to download and install on your computer.
For a quicker and easier experience, look for electronic signature software that specifically offers an app for Apple devices in the App Store: specially-designed apps can offer a cleaner and easier user experience.
Q: Can electronic signatures be notarized?
A: While it’s possible to get electronic signatures notarized (look for “e-notarization” services), it’s still fairly uncommon.
One of the last bastions of physical signatures is on government or legal documents that need to be verified through notarization—because you need to physically show up and present identification, this process is harder (though not impossible) to do electronically.
Q: Can electronic signatures be forged?
A: Electronic signatures in general can be forged, but digital signatures (a particular type of electronic signature) are very difficult to forge.
Digital signatures rely on access to a private “key,” which validates your personal identity. Unless an adversary has your private key, they cannot forge your digital signature.
Added security measures, like two-factor authentication or geolocation capturing (which shows where you were when you signed the document) can make electronic signatures even more difficult to forge.
For these reasons, an electronic signature can be much more secure and resistant to forgery than a physical signature.
Q: Can electronic signatures be legally binding?
A: Yes, electronic signatures are enshrined in law, both in the United States and the European Union. In the US, the ESIGN Act specifically states that any legally binding contract or agreement cannot be thrown out because it is in electronic format, and EU law has similar specifications. An electronic signature is just as legally valid as a physical signature.
Q: Is a digital certificate necessary for an electronic signature?
A: No, digital certificates are not mandatory for an electronic signature. However, they are often necessary if you are implementing a digital signature in your document.
Any good electronic signature software will be certified by a certifying authority, or CA: this certification lets you or anyone else validate the integrity of the signatures on your document and the document itself.
Recap
Electronic signature software can dramatically speed up the process of sending and receiving signed documents, whether that’s a contract, a sales invoice, or a hiring agreement.
With electronic signature software, you can both improve your productivity and your security, because with the right software, electronically signed documents can be validated both for the identity of each party who signed and the integrity of the document itself.
