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Electronic Signatures vs. Digital Signatures: Which One is Better?


Potayto, potahto, right? Well, not quite. The terms electronic signature and digital signature are often used interchangeably. However believe it or not, there’s actually quite a big difference between the two.

So what characteristics distinguish a digital signature from an electronic one, anyway? And which one might be better for your business to embrace?

Here’s what you need to know:

What is an Electronic Signature?

A lawyer signs a contract digitally

An electronic signature is a legal concept. It holds the same weight as a handwritten signature, and it is used to signify the knowledge and acceptance of a document.

Many electronic signature providers also leverage audit trails, which keep track of who signed what and where, etc. - thus making the electronic signature more difficult to forge.

For a more official definition, we can also take a look at The Electronic Signatures in Global and National Commerce Act (E-Sign Act), which was signed into American law in 2000.

It defines an electronic signature as “an electronic sound, symbol, or process, attached to or logically associated with a contract or other record and executed or adopted by a person with the intent to sign the record.”

As you can see, it’s a pretty broad definition - and means that things like voice signatures can also be legally binding.

What is a Digital Signature?


A digital signature is the encryption technology behind electronic signature tools, which works to guarantee that the document has not been altered.

In simple terms, digital signatures leverage something called Public Key Infrastructure (PKI), and this uses an algorithm to generate two different keys: one public, and one private.

The person who signs the document holds the private key, which is encrypted. If the recipient opening the document with the public key can’t decrypt the signature, this means the document has been tampered with - and the signature will be invalid.

Overall, it helps legal professionals and other parties signing a document to be sure no signatures have been forged - but also, to ensure no changes to the digital contract were made.

Which one is best for your company?


Electronic and digital signatures provide organizations with a more secure way to sign legal documents - helping to reduce the chances of forgery and fraud.

Electronic signatures enable organizations to leverage audit trails to keep track of who signed the document and when. However, digital signatures go even further and provide more security to its users.

Electronic signatures are for fine for organizations signing off on day-to-day documents, while digital signatures are the better option for law firms and other businesses or entities signing high-stake legal contracts.

The most optimal way to start using digital signatures is to have them integrated in your document automation software. Therefore, you will avoid facing integration challenges and ensure the highest level of security for your business.

Talk with one of Bigle Legal's Legal Operations Consultants and request information now.

What are the benefits of electronic and digital signatures?

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If you’ve ever used an electronic or digital signature, you know they can be much more convenient than old-fashioned handwritten ones.

Besides, they can also help you provide better customer service, increase efficiency and save on business costs - among other things.

Let's take a closer look at the business benefits below:

You can save money (a lot of money!)

Digital and electronic signatures can provide organizations with a huge number of direct savings - including reducing the amount spent on printing paper, ink, envelopes, postage stamps and couriers, among other things.

At the same time, since using digital signatures can help increase efficiency, they also provide organizations with a range of indirect savings. Think about how long it takes each team member at an organization to file documents correctly, print, scan and wait for a contract to be delivered back signed.

Now, just consider how much an organization is paying employees to do these drawn-out tasks.

In fact, businesses using electronic signatures spend 55% less than if they’d sent 200 invoices in ordinary mail and 79% less than businesses sending them in certified mail.

You can serve clients better (and boost their loyalty!)

Having to print, sign, scan and upload documents can get old fast - especially when a company or firm deals with hundreds of contracts a month.

However, leveraging electronic or digital signatures not only saves employees time and stress: it also makes things a whole lot easier for clients.

Instead of them having to take the time to sign a document by hand and reupload it, electronic and digital signatures empower customers to sign in seconds. It’s a small way to demonstrate to customers that their time matters.

You can speed up closing deals (and increase conversion rates!)

Electronic and digital signatures streamline the contract-signing process. This can be a huge advantage when it comes to closing business deals, for which time is always of the essence.

In fact, we found that businesses using Bigle Legal, which offers digital signatures along with document automation, complete contracts 91% faster than those who don’t.

This gives potential clients less time to explore what the competition is offering, and demonstrates from the get-go that an organization knows how to deliver on things fast.

You can facilitate cross-border business (and collaborate better!)

Sure, business gets done across borders. But it never happens very quickly.

Electronic and digital signatures enable people, organizations and public entities to complete transactions in a single click, no matter where they are.

In fact, the EU calls its eIDAS Regulation - which includes the use of electronic signatures - one of the building blocks of the Digital Single Market, a strategy designed to open up digital opportunities for businesses and individuals across Europe.

What should you look for in a digital signature solution?

First of all, when looking to leverage a digital signature solution, you should find one that is fully compliant with U.S., European, and other international digital signature regulations. This is something that is especially important if working with an international client base.

Other important factors to consider are:

  • Best UX designed for ease-of-use (for the company and its clients)
  • Ease of integration
  • Security

What's next?

As you’ve seen in this article, there’s actually quite a difference between electronic signatures and digital signatures - and much of it has to do with the level of security they offer.

In reality, your choice will depend on the industry your organization operates in, and your business goals.

Have any doubts on what’s right for you? Feel free to reach out to us and we’ll be happy to give you the advice you need!