Electronic Signatures

Electronic Signatures: Their Use and Benefits

electronic signature

The Definition and Benefits of Electronic Signatures

Also called e-signatures, these proprietary methods serve to validate a message or document. For example, an e-signature can confirm that a person adopts the guidelines or contractual obligations of a certain message. Conversely, this type of signature will also be used to confirm that the statement is valid and sent by the individual or entity which wrote it. Simply stated, these signatures can be thought of as the virtual form of an official seal or handwritten confirmation.

The first benefit associated with this type of software is security and risk aversion. An electronic signature is not only a considerably robust form of software validation but it also represents a legally binding agreement that is valid in court. Furthermore, such signatures reduce the time of data transmission due to their online nature. This will help close deal quicker and lessen the chances of external variables interfering with such circumstances.

The temporal advantages should also be emphasized. As opposed to sending out physical mail that can be lost, stolen or damaged, transmission and receipt of all paperwork can be accomplished nearly instantaneously. This has the obvious benefit of reducing the time needed to obtain and verify documents.

A third consideration is the fact that this electronic sign can be verified with the use of a PDA or a laptop. There is no need to print a document and signing such data can be done remotely. Additionally, there is no need to download any extra software to do so, as such documents are normally in Word or PDF form.

Three primary advantages of an electronic signature can be seen as:
  • A more secure form of data verification.
  • A reduced amount of time; thus they are ideal for sensitive business transactions.
  • Remote access and no need to download any software.


While it is impossible to deny these previously mentioned benefits, there are also a few drawbacks that should be taken into consideration.

One of the first concerns is the expiry that some signatures will have. Although these signatures are binding in the legal sense, technological advancements may allow the software used to become obsolete in a rather short period of time.

While on the topic of legality, it should be known that not all countries or entities will consider such online verification binding. It is therefore wise to determine the status of such signatures before attempting to do business with a third party.

Although there is no need to download additional software, there may be compatibility issues with different types of signatures. For example, an e-signature on a PDF may not be compatible or as official as one sent via an email that only requires the "tick" of a box on an end-user license agreement.

Finally, the aforementioned ability to replicate such signatures poses a problem for highly sensitive documents. In comparison to digital signatures that are more complicated, electronic signatures can be duplicated with relative ease.

To review, a handful of disadvantages associated with electronic signatures are:
  • A possible expiration of the technology utilized in such documents.
  • Legal nuances between different regions or companies.
  • Possible questions of compatibility.
  • These signatures are relatively easy to replicate.