Many businesses have been switching from physical documents to digital ones — also often referred to as electronic documents. As documents have become digitized, signatures have followed suit.
Electronic signatures, most commonly known as e-signatures, have grown in popularity as e-commerce and technological breakthroughs have propelled the idea of going paperless. With e-signatures, businesses can deliver a much smoother, faster, less complex, and more digitized experience for their customers, partners, and employees.
For many years, the real estate industry has been increasing its use of technology to conduct business. E-signatures are now often used by buyers and sellers to close contracts, resulting in efficiency and convenience.
E-signatures have become a beneficial tool in HR processes. Onboarding usually takes a lot of time and requires signing many documents, including the call letter, offer letter, and social media policy, among others. It’s for this reason that businesses have started leveraging e-signatures to streamline their onboarding processes.
Furthermore, e-signatures have shown to be quite advantageous to the sales industry. Converting leads to customers takes time. Paperwork like quotations, invoices, proposals, and other agreements take time to complete. E-signatures have shown to be extremely useful in these situations.
But what exactly is an e-signature? An electronic signature is a digital impression, mark, symbol, or any element that indicates that the person e-signing the electronic document agrees to its content. It’s distinct from what was historically called ‘wet signature’, in which contracting parties had to physically mark physical documents with a pen.
Because electronic signatures can be used to sign documents in various formats, including PDFs, word documents, spreadsheets, and various native browser-based contract platforms where contracts can be signed in seconds, the majority of the world has adopted this modern approach to contract signing.
As technology advances, more corporate processes are going online. Electronic signatures help in accommodating this shift. The advantages of employing e-signatures, such as faster document processing, streamlined corporate procedures, and better security, have made e-signatures prominent. E-signatures are also legally binding and can decrease operational costs.
If you’re one of these businesses, this article can help you better understand e-signatures by discussing the dos and don’ts you have to consider.
Do trust it
E-signatures are just as effective as traditional signatures. They are legally binding in most parts of the world. In the United States, e-signatures are legal under the Electronic Signatures in Global and National Commerce Act (ESIGN Act). The ESIGN Act is a federal law that certifies that electronic signatures have the same legal standing as handwritten signatures if they meet four major criteria: Intent, Consent, Accuracy, and Retention.
You must understand that as the signer or the person requesting the signature, electronically signed contracts are legally binding in the same way traditional, hand-signed documents are. You can rely on it and treat it as you would any legal document.
Do get consent
The ESIGN Act specifically states that the signer’s consent must be obtained ahead of time. As the person requesting the signature, you can include a clause in the contract declaring that all parties agree to conduct the transaction electronically.
As the signer, you must be aware that your consent is an important attribute for your e-signature to be valid. Before e-signing, you must review and agree to the terms mentioned in the document.
Do read the entire document
As the signer, you must examine, read, and comprehend the terms included in the document you’re e-signing. Similar to signing traditionally, you wouldn’t want your signature on anything you don’t completely understand.
As the person requesting the signature, you must ensure that the document you’re sending is the right one. Viewing and reading it will help you avoid mistakenly sending the wrong document.
Do send securely
As the person requesting the signature, you must ensure you have the correct person e-signing the document. You can do this by emailing the signer a secure link to the document that was created by the e-signature software. Most e-signature applications have an emailing feature.
As the signer, you have to be careful with sending your e-signed documents to unrelated parties. You must consider the potential consequences of the documents falling into the wrong hands.
Do keep a copy
As the signer or the person requesting the signature, you must keep a copy of the documents, either electronically or printed.
When storing essential documents, you want to keep two things in mind: keeping them at hand in case you need them and protecting them from theft, fire, or other disasters. It is always beneficial to have duplicates of the documents.
Do track, save, and label all e-signed documents
During the negotiation process, a document may be passed back and forth between parties. You, as the person requesting the signature, must keep track of any modifications to the documents; even little changes might be significant. For storage purposes and easy retrieval, you must also label the e-signed documents.
As the signer, you should always save a copy of the last document that you signed. This is so you can avoid misunderstandings, in case the person requesting your signature loses track of your e-signed documents.
Don’t use it for everything
Not all documents can be electronically signed. As outlined by the National Telecommunications Information Administration (NTIA), e-signatures are not legally acceptable when signing wills and testamentary trusts, court orders or official court documents, termination notices for health or life insurance policies, and more.
Both the signer and the requester should be aware of the restrictions of employing e-signatures. You should always refer to laws in your jurisdiction regarding your specific e-signature use case.
Don’t rely on verbal requests to appear on the contract
As the signer, if you want to make sure that all of your requests were included in the contract, you must thoroughly check the document before e-signing. Often, relying just on verbal requests might lead to deception.
As the person requesting the signature, it is your responsibility to ensure that the contract’s clauses cover everything the parties have agreed to.
Don’t sign too quickly
E-signing, as convenient and efficient as it is, is not a race. Just like with traditional signing, you can take your time, review the documents, and ask questions if you don’t understand something in the documents. It is your right as the signer to thoroughly inspect the paper before e-signing.
Don’t neglect to send signers a copy
Document signers would most likely want to have a copy of the signed documents. It is your responsibility as the person requesting the signature to guarantee that the signers get copies of the documents they e-signed. Although the e-signature software you’d use will most likely accomplish this for you, you should still check.
Don’t forget to choose the right e-signature software
When choosing the right e-signature platform, it’s important to know which key features you’ll need. Here are seven features you can look for in e-signature software:
- Can e-sign documents on mobile devices. Mobile phones have become an integral part of everyone’s lives. An e-signature platform must be able to meet this expanding demand by allowing signers to sign documents on the go.
- Has access to real-time analytics. Real-time data can assist you in better understanding how prospects and leads interact with proposals. On-demand access to this data can help you improve your offers and close agreements faster. The best e-signature software will provide you with useful analytics so you can see when prospects open your offers and sign on the dotted line.
- Has customer relationship management (CRM) integrations. One of the best features of CRM solutions is its ability to integrate with other apps, platforms, and technology to streamline your processes. A dependable and helpful e-signature platform will be able to link with your preferred CRM platform, making it much easier to keep track of what’s going on across your whole business pipeline, saving you a lot of time in the process.
- In compliance with security and privacy regulations. Users, clients, and document signers need to feel safe when communicating. The e-signature platform you should use must comply with security and privacy standards in the countries where you do business.
- Has automation capability. Automations help reduce the amount of time spent on administrative and repetitive duties, and the best e-signature software will provide it.
- Is flexible and within reasonable cost. Many solutions provide free trials so you can compare them before deciding on your favorite. There are also many subscription tiers or packages available. Understanding the value for money and taking advantage of any “freemium” offers before signing up for a fully paid service is a good way to choose the best electronic signature software provider for your organization.
- Is easy to use. The ability to make your life easier is one of the most significant aspects of any digital tool. An e-signature platform must be simple to use for both you and your clients. It’s not productive for either party to spend time explaining how to utilize a platform.
The use of electronic signatures is quickly becoming the norm in the business sector. It offers numerous advantages, including increased efficiency in signing processes, elimination of time-consuming steps, and reduction of document exchanges. With the ever-evolving digital landscape, it’s no surprise that businesses consider electronic signatures to be one of their essential digital tools.