How electronic signature helped companies throughout the pandemic
We all saw how the unfortunate COVID19 pandemic pushed a lot of companies towards digital transformation, where e-signature played a crucial role.We witnessed the global economy experiencing serious turbulence and that the main outcome of this pandemic is yet to be seen. However, we are lucky that technological evolution is in an advanced phase.
Now when the overall labor market is shifting to remote work, and the company-client collaboration is changing, too. The main issue this year was how to continue providing services and start new partnerships that are contract-based when it is not possible to have a traditional meeting and shake hands to close deals.
Multiple industry leaders have recognized the benefits of utilizing e-signatures long ago, however, it has become more of a necessity to use e-signature during covid19. Many professionals wanted to continue working and be able to sign a contract from their homes while not endangering anyone around you and still thriving in the business space.
You are probably wondering if they are really effective as the traditional contracts, and if it is as legitimate as the traditional signature, let’s find that out!
However, let us first make a short e-signature introduction.
1. What is an E-signature?
Simply said, an e-signature is an electronic alternative to handwritten signing of documents. By being time and place independent, it enables virtual collaboration between two parties from any location worldwide. The parties can draw their signature digitally at any time, at any given moment. The only thing is that the consent is given on an electronic document and in an electronic format.
E-signatures are more than just signing a paper and scribbling at the bottom part. It is a tool that extracts biometric data from the signature of each party so it allows to link the signature with the signee and it seals the document and stamps it with a valid and incorruptible time stamp.
The electronic signing is already accepted and used in many countries around the world. Many governments have embraced this new and efficient way of doing business, boosting the speed of creating cooperation, thus their economies, too.
2. E-signature advantages
E-signature certainly has numerous advantages. Moreover, it is proven that it became a more profitable and secure type of contract creation and processing.
However, let's first focus at some of those advantages that are helping businesses recover from the lockdown and making their financial scores stable again.
The top e-signature features are:
- Electronic signatures allow tracking of a signer by trapping some unique evidences of the signing process, such as the IP address of the device where the contract has been signed, their geo-location, their biometric data, or the device they use to sign, amongst others.
- Cloud-based e-signature options give you the freedom to access your contract on a secure website at any time and from anywhere.
- You can forget about the massive time and money investments that come with the document exchange through the post.
- Today, e-signatures can be easily integrated into document automation softwares, document management systems or document workflow solutions such as Bigle Legal, for e-signatures and all your legal documentation to be in one place.
Some companies have been preparing for digital transformation for years, especially in the e-signature sphere. However, they still faced certain challenges due to the covid19 situation.
It seems like the insurance companies suffered the most as their whole business depends on fast contracts that were usually finalized in person. One of them is Lincoln Financial CIO that has incorporated advanced digital tools before the crisis, however, now they made radical changes. In their life insurance business, they were worried about gaining new clients and extending the existing collaborations and that was because their meeting was based on face-to-face discussions and the delivery of the policies was completely running through the post network.
Before, they used to print and mail policies to stakeholders. Luckily, they discovered the power of e-signature and now 100 percent of their life insurance policies are delivered electronically. They have recorded a significant reduction in costs of contract services.
Even many insurance providers have stated that covid19 has increased the pressure of providing remote customer experiences. That is why in our example of the insurance company, they decided to enhance their insurance software with e-signature features to enable everyone to enjoy the perks their services bring.
Other companies stated that the shift to e-signing is a process but that they are already seeing positive results.
I would say that the elimination of time and location restrictions caused by the e-signature processes, can only help companies build up their global presence and increase their revenues significantly.
3. How to use electronic signatures?
Useful tips and information save you a lot of time you would spend on wrong attempts.
Here is an effective and concise e-signature guide:
- To speed up your delivery process and make everything go smoothly, use a cloud-based e-signature provider. At the same time, you will have a secure data storage where you can find any document you may need.
- Choose an e-signature provider that is registered and complies with the legislation on e-signatures in your country.
- Make sure that your e-signature provider collects enough details during the signing process that enable third-parties to identify the signer.
- Choose the e-signature service that tracks and notifies you about the changes in status during the signing process.
- In today's world of consistent cyber-attacks, it would be a smart decision to use a provider that is conscious about security and uses the latest security measures to ensure that your data will stay stored safely.
4. E-signature laws
Generally, e-signatures are developed to have the same function as the paper and ink. There are two US laws that regulate and guarantee the validity of an e-sign, the federal Electronic Signatures in Global and National Commerce Act (“E-SIGN”) and the state Uniform Electronic Transactions Act (“UETA”). On the other hand, in the European Union, the legal background comes from the Regulation (EU) No 910/2014 of the European Parliament and of the Council of 23 July 2014 on electronic identification and trust services for electronic transactions in the internal market and repealing Directive 1999/93/EC.
In both jurisdictions the legal effect of e-signatures follow a similar definition;
In the US: “an electronic sound, symbol, or process, attached to or logically associated with a contract or record and executed or adopted by a person with the intent to sign the record.”
In the EU, ‘electronic signature’ means data in electronic form which is attached to or logically associated with other data in electronic form and which is used by the signatory to sign.
Another similarity, is that both jurisdictions protect the use of e-signature by ensuring that legal enforcement of an e-contract can’t be discredited solely due to the electronic nature of the contract.
In a nutshell, the said regulations opened the door long time ago to use e-signatures in our commercial operations and benefit from the speed and security that these solutions provide.
5. The Rise Of Online Notaries
Even though e-signature were becoming a popular business tool long before the covid19 pandemic, notarization was still required to be in person. However, the pandemic turned the idea of virtual notarization into reality.
Many states across the US have enacted executive orders that allow temporary remote notarization. For instance, New York has introduced its Executive Order Guidance that regulates all the virtual notarization within its territory.
In comparison to e-signatures, notarization processes still require some type of in-person experience such as video conferencing. That is how notary can verify the signing party and ensure compliance during these uncertain times.
How does that work? A party that intends to sign a document electronically is required to be on video call with a notary that can witness this whole process. Of course, the electronic signature the signers intend to use should be covered under the state law first.
Many more governs in the world have passed similar regulations to make it more flexible and convenient for the client, the mandatory intervention of a notary when the local law requires their ultimate authorization.
Document and e-sign automation
Making contracts and finalizing them is a thorough process that must be managed efficiently from the beginning till the end. Keep in mind that e-signature is just a step (often the final step) of the process.
The document or contract template must be drafted, then assembled, and probably validated along the way with the other parties and managers. There are also emails to send and information of the signing parties that you need to collect. Among many other tasks that revolve around producing a well drafted document or contract and getting it authentically signed.
Document automation software, such as Bigle Legal, is the full package that does all that for you. You can automate your contracts and documents so that the creation of a document will take a few minutes instead of hours, get them validated by other members of your team in one click, share links and copies through email and digitally sign the document at the end, and all this is done from within one place and that is the Bigle Legal platform.
In conclusion e-signature plays a crucial role when it comes to document management, however, it is far from being enough on its own. So in order to make sure that the documents are managed properly you will need a document automation software, to be able to manage the process from the beginning till the end and to make sure that you are streamlining your workflows and tracking approvals when needed, while most importantly, being able to do it remotely and safely from the convenience of your home or anywhere else for that matter!