What is an Electronic Signature?

What is the function of an electronic signature?

The function of an electronic signature is to capture the intent of the signer to be bound by the terms and conditions in a contract. Electronic signature software is designed to capture legally-enforceable signatures online.

Generally, it is about having a lasting record of an individual’s intent. Digital signature refers to the encryption technology used in a number of e-business and e-commerce applications, including electronic signature.

There are generally three types of electronic signatures recognized around the world: Basic, Advanced, and Qualified. See details below.
 

What are the benefits of electronic signature?

• Great User Experience
  Ensure high user adoption and satisfaction with the most seamless, white-labeled e-signing experience
• Advanced Security 
  Protect your users and documents against fraud with military-grade digital signature technology.
• Audit Trails 
  Strengthen your compliance and deter legal disputes with the most comprehensive audit trails in the market
• Efficient and Scalable 
  Scale electronic signatures across your organization and channels – quickly and cost-effectively
• Cost Effective 
  Get predictable pricing and a cost-effective solution regardless of your volumes – no nickel and diming.
• Versions 
  Available as a web or mobile app, developer SDK, 3rd party connector, and specialty solutions for financial services
   

How do electronic signatures work with OneSpan Sign?

• Step 1: Access
  Email Invitation Link in a customer portal
• Step 2: Identify / Authenticate
  Email, Login credentials, Challenge-response questions, SMS PIN, 3rd party ID check, Digipass®, Biometrics, Government ID
• Step 3: Present
  Documents are presented on a desktop or mobile device. Define workflow rules and control which documents are visible to participants in the transaction
• Step 4: Data Capture
  Capture data at the time of signing and make that data available to downstream systems
• Step 5: Re-authenticate
  Optionally verify the signer’s identity at the time of signing. For example, signers can use their government-issued electronic ID (eID) to create a Qualified electronic signature (QES)
• Step 6: Sign
  Click to sign, Click to initial,Hand-scripted, signature capture
• Step 7: Document Insertion
  Additional documents or images (e.g. a photo of a driver’s license) can be inserted as part of the transaction
• Step 8: Deliver
  Signed records can be distributed electronically or on paper
   

What is electronic signature used for?

Processes like sales contracts,  HR, invoicing, and more are achieving rapid gains in efficiency and drastic reductions in cost thanks to widespread acceptance of electronic signature in the market.

• Procurement and sourcing
• Contract modifications
• Credit or loan applications
• Federal tax returns
• e-Contracting
• Service agreements
• Real estate transactions 
• Claims and appraisals
• Account openings
• Commercial lending
• Delivery order requests
• Retail finance

Are electronic signatures legally binding?

Yes. OneSpan Sign’s electronic signatures make it easy for organizations to capture legally binding e-signatures and are valid in countries that have enacted electronic signature laws.

An electronic signature created using OneSpan Sign is designed to meet the requirements of the U.S. ESIGN Act and UETA, as well as the European Union's Electronic Identification and Trust Services Regulation (eIDAS).

For a legal opinion on the enforceability of electronic signatures in a given country and any local data residency requirements, consult your legal counsel.
 

What are the different types of electronic signature?

There are generally three forms of electronic signature recognized around the world: Basic, Advanced, and Qualified.

The Basic electronic signature

The Basic electronic signature is not a standardized term across nations. Depending on the state, some countries may refer to this as a “Simple electronic signature.” However, both terms describe the same concept.

The Basic electronic signature is technology-neutral. Meaning, any electronic form or process is generally accepted so long as the resulting electronic signature meets three basic requirements for signing:

1. The electronic signature should be applied in a manner that demonstrates the intent of the signer. The electronic signature can be captured by click-to-sign, typing a name, or a handwritten signature
2. The electronic signature should be applied by the person associated with the signature
3. The electronic signature should be associated with the document or data the signer intended to sign

OneSpan Sign meets the requirements for Basic electronic signature

The Advanced electronic signature

Advanced electronic signature goes beyond the Basic by tying authentication to the signature and agreement. This mitigates risk in the transaction by providing additional evidence that can be used to verify the authenticity of the signature.

Most organizations and banks opt for the Advanced electronic signature as their standard form of electronic signature. The inclusion of built-in authentication increases signer assurance without a significant impact to the customer experience.

This form of electronic signature adds four additional requirements beyond those of the Basic Electronic Signature. The Advanced electronic signature must:

OneSpan Sign meets the requirements for Advanced electronic signature.

1. Be uniquely linked to signer
2. Identify the signer
3. Be under the sole control of signer
4. Detect changes to the document or data after the application of the electronic signature

The Qualified electronic signature

The Qualified electronic signature is the legal equivalent to a handwritten ink signature.

The extra security of a Qualified electronic signature can also create friction in the transaction. Your signers are required to procure a signer-held digital ID and meet face to face. These extra steps create a longer signing process and ultimately increase the overall cost beyond what other e-signatures might require.

OneSpan Sign meets the requirements to use a third party digital certificate as an electronic signature, but we do not issue these certificates to users ourselves. Instead, we can assist clients in finding a trusted partner to issue digital certificates.

The term, Qualified electronic signature, is based on the EU regulation known as eIDAS, but it is similar to many other laws around the world that require a certificate issued by an accredited organization.