What is an E-signature and How Can it Help your Business?

What is an E-signature and How Can it Help your Business?

Table of contents

Written by Timothy Ware

An e-signature is a secure digital imprint used to agree to the terms of a electronic contract. Much like your standard “wet” signature, it is used in many different situations for many different reasons. The answer to “what is an e-signature” changes depending on the business or department, but ultimately the answer boils down to “a better way to do business.”

In a business, signatures are necessary for many different basic documents, including documents like NDAs or equipment loaning agreements, and these can take up substantial resources to deal with. e-signatures can simplify your business, reduce costs, and improve productivity.

To see how SignTime’s e-signature and electronic contract service will improve your business, sign up for a free trial now.

What is an e-signature?

In many cases, an e-signature is an inserted symbol (or inserted image of your actual signature, a stylized font, a seal, etc.) that is used to enter into legal agreements digitally. Because most countries around the world view them as legally binding, you can do business internationally using e-signatures.

This makes things much easier (and cheaper) than needing to courier documents, have them signed, and then getting them back for approval—or worse the print-sign-scan-send cycle.

SignTime is ready to simplify your business.

How can e-signatures help your business?

Now that we’ve answered the question “what is an e-signature,” the next thing to talk about is how e-signatures can help your business. Many companies can be nervous about changing the way that they operate. However, there is a fine line between being cautious and being left behind, and not changing the way you do business while the world does is just as risky as trying something new. Here, I’ll go over several ways that e-signatures will positively affect your business.

If you want more information on what e-signatures mean for your business, we have an informative article on the subject.

In a nutshell, e-signatures are one of the simplest digital solutions to achieve a more efficient and effective company. Because they have such far reaching impacts, they can improve multiple departments in very different ways.

They’re legally binding

The Uniform Electronic Transaction Act (UETA), passed in the USA in 1999, provides the necessary legal framework for the use of e-signatures. The next year, the Electronic Signatures in Global and National Commerce (ESIGN) Act was passed. These two laws made e-signatures legally valid and enforceable and created acceptance of their use.

Many countries around the world have also implemented similar frameworks, making e-signatures a simple, reliable, and enforceable way of doing business globally.

The ability to ensure that your contracts are valid when doing business internationally, but without needing to worry about expensive international courier services to send paper contracts around the world, has greatly simplified how we do business overseas.

e-signatures lead to better customer service

People want good and reliable service. They also want efficiency and a quick turnaround. Using a high-quality e-signature service solution will simplify the entire signing process, from drafting to storage.

Because documents can be changed and updated on the fly, documents won’t fall into a “black hole” and be forgotten. Remember that unhappy customers can have a disproportionate negative impact on your business, and telling a customer “we forgot about your contract” is never going to make them happy.

These electronic contracts can be easily tracked, and you can use powerful e-signature tools to set reminders and updates.

Clients can also provide feedback about a contract immediately so that the contract can be updated and signed in minutes instead of the weeks it might take to redraft a paper contract and then send it to another country.

Customers who have a pleasant and efficient experience are more likely to continue to do business with a company in the future.

e-signatures shorten the sales cycle

Without the need to sign, scan, mail, print, or wait for documents to be delivered, your sales team is empowered to close deals faster and more effectively. Your team can make corrections and changes to documents in the moment, without the need to find a printer or a scanner.

With SignTime’s services, adding dates and names, initialing, and agreeing to the terms of a contract is as simple as tapping your smartphone’s screen. 

Customers appreciate not needing to wait for a long time to receive files. When they receive a document only to need to print it, sign it, and then scan it again to return it, it increases the likelihood that they’ll put off the task. Say goodbye to the tedious print-sign-scan-send cycle, and your sales team will thank you.

When your sales team can spend more time closing sales and less time chasing documents, you will empower them to increase their sales.

They make HR jobs easier

The HR department is responsible for a lot of different jobs in your business.

Many of the jobs they do require coordination between different departments and getting documents signed. NDAs require signatures from new employees, and finalizing contracts may require signatures from several different parties.

e-signatures present a valuable opportunity to streamline several processes. With a couple of clicks, you can send documents that need to be signed to hundreds of employees at a time, track them, and get them back moments later. This would have been impossible a few years ago with pen-and-paper documents.

This efficiency will let your HR team focus on other more important projects.

e-signatures can improve your operations

The ability to digitize, simplify, and automate many elements of your business operation achieves two major goals. The first is that they remove the barriers caused by analog systems. Before, you might have needed to print a document, mail it for a signature, wait for it to be returned, get it checked, and then store it in a filing cabinet. Now, the whole process can be done more safely in a couple of hours.

The ability to tag your files digitally means that you can always find what you’re looking for right away. It doesn’t matter if you’re sitting at your desk or going into a client’s office. The files are always at your fingertips.

e-signatures are environmentally friendly

As companies position themselves to be more environmentally friendly, e-signatures can help. e-signature services allow you to digitize your files and to remove paper waste.

Paper documents generate a great deal of waste. Imagine printing off 100 copies of a 30-page document that has mistakes in it. Using SignTime’s services makes correcting files on the fly easy, and you’ll never need to reprint the same file because of a spelling mistake.

No paper. No ink. No waste.

Your company will be more environmentally friendly from the first day that you start using an e-signature service. They can be your company’s cornerstone to establishing a more sustainable and green business practice.

This is becoming increasingly important to businesses. You don’t want to lose a major sales deal because you are seen as inefficient.

They will save you money

The bottom line is that a company can only really survive if it generates profit. Part of how you can generate greater profit is by reducing your costs.

These costs come in many different forms, and they can include things like supplies ( ink, paper, printers, scanners, filing cabinets, staples, paperclips, etc.) and time (how long your salesperson needs to wait for a document, the time it takes to print off 50 copies of a file, etc.). An e-signature service can easily help to reduce both of these significantly.

With less wasted time, your sales team can close more sales. With less supplies needed, your company spends less money purchasing equipment and goods. Your company can see savings in many different departments, from HR to legal to sales, and these can add up to very significant savings—thousands or tens of thousands of dollars a year for a medium-sized company.

e-signatures vs electronic contracts: are they the same thing?

Both e-signatures and electronic contracts are complementary parts of the same process. The electronic contract is a contract that has been drafted, signed, and stored digitally, while the e-signature is the way in which you confirm that you agree to the terms of the electronic contract. In many ways, they are the evolution of the traditional “pen-and-paper” agreement.

Because of modern legislation, e-signatures and electronic contracts usually have the same legal standing as traditional contracts so using your e-signature to sign a document is just as valid as a “wet” signature.

e-signatures vs digital signatures: what’s the difference?

Sometimes products have similar names but aren’t the same. In many cases, when people use “e-signatures” and “digital signatures” they are referring to the same thing—signing a contract in a digital way.

However, they are technically referring to different things. e-signatures are used to affirm agreement to a document. While there are laws stating their equivalence to handwritten signatures, each e-signing doesn’t require any certification.

A digital signature, conversely, is a security code implanted in a document to prevent counterfeiting. True digital signatures require registration and certification. These kinds of signatures are usually an embedded “fingerprint” of sorts that allows verification of the authenticity of the document.

A common form of e-signature that you have probably already used is the “agree” button on the terms of service of a product.

An important thing to remember is that many people and companies will use these terms interchangeably, so it is very important to ensure that you have a clear and transparent explanation of what a service offers. SignTime uses the term e-signature to reduce the chance of confusion.

Scanned digital signatures vs e-signatures

Some people want to use their own handwritten signature in online documents. This can be done by putting your signature on a piece of paper and then saving it in a digital format (PDFs are quite common). Creating this scanned signature allows you to use your own signature instead of one that is stylized or provided.

These scanned digital signatures are a type of e-signature that can be used to quickly sign agreements, NDAs, or employment agreements.

While using SignTime these signatures can have embedded security added, simply copying and pasting the e-signature into pdf files might not be as secure. It’ll also prevent a lot of the added features of a electronic contract service. For example, there is no confirmation email generated that the contract has been signed, and there is no tagging function to allow finding the document quickly at a later date.

Online contracts vs electronic contracts: are they the same?

Unlike the differences that can exist with e-signatures and electronic contracts, very little difference exists with the online contracts vs electronic contracts question.

The difference between the two terms is generally about a point of view. The term online contract focuses more on the fact that these contracts are handled on the Internet, whereas the term electronic contract emphasizes the paperless nature of the contract.

In SignTime’s case, we opt to use the term “electronic contract” and we view signing documents as only one part of the full contract lifecycle. Templating, mass sending, and the easy to search contract repository are all just as valuable as the e-signature function.

We compare all of these terms further in another article.

Things that you need to know about signing electronic contracts

First, the most important thing to know is that there are lots of different kinds of services that can help you accomplish your goals. Some of these services only allow you to place an e-signature on a document, while others like SignTime are more of a full electronic contract solution. To learn more about electronic contracts and how they can impact your business, we go into greater detail on this in another article.

Having transparent services and pricing is important

Another thing that is important to know is just how radically e-signatures and electronic contract services can impact your business. By automating tasks and greatly increasing the speed at which they can be finished, electronic contracts can save your company money while freeing up your staff so that they can focus on other important issues.

Electronic contracts make signing easy

While simple contracts like NDAs and equipment loan forms can take up a lot of time, they don’t have to. e-signatures make finalizing these documents a snap, and the turnaround time can be mere moments.

Digital documents can remove a lot of complications from the signing process. With the ability to control fields on a contract, you can make changes to the date, initial, sign, etc. fields in seconds. With so much flexibility, you’ll never waste time needing to redraft and print out whole contracts because of an incorrect name or the wrong date.

Who benefits from electronic contracts anyways?

While you might feel like only the signatories benefit from electronic contracts, this isn’t really the case. Because of how many different parties need to use contracts (from legal departments, to HR departments, sales teams, and customers), the benefits from electronic contracts can be felt far and wide.

Here are a few examples of parties that benefit:

  • Authorized signatories
  • Sales departments
  • Counterparties
  • New employees in your company
  • And many more

Take a look at what a Japanese HR management consulting firm had to say about SignTime’s e-signature services.

The bottom line

Incorporating powerful tools like e-signatures and electronic contract services into your business can address existing issues affecting your business. We go into further details on how e-signatures can impact your business in another article, but we provide a brief summary of it here.

Contracts that used to take weeks to finalize can be done in hours

Contracts needing to be updated, reprinted, and sent out can be fixed with a few taps of your smartphone or a couple of mouse clicks.

The money that you spend on paper, couriers and ink will stay in your pocket

When you give your staff the tools they need to close deals more effectively, you increase customer retention and happiness. An e-signature tool is one of the easiest ways to improve your company’s conversion rate and is a great way to make things easier for your departments as a whole.

To see one way that e-signatures can save you money, read this article about reducing FedEx costs. You might be surprised to see how quickly those dollars and cents can add up to thousands of dollars of potential savings.

SignTime can help guide your company into the future and there has never been a better time to take the first step and sign up for a free trial.

FAQ about what is an e-signature

With so many terms and options available to you, we do our best here to answer any questions that you might have in a handy and digestible way. Take a look at some frequently asked questions about e-signatures and electronic contracts, from what is an e-signature to how do they work.

What does e-signature stand for?

Simply, “e-signature” stands for “electronic signature.” It is sometimes referred to as a digital signature as well, but technically digital signature is something else.

What is a electronic contract?

A electronic contract, or an e-contract, is a contract that is created and signed digitally. There are no paper versions of this contract (unless they are printed off). They are also stored digitally, which makes them easily accessible but also very safe.

What’s the difference between a electronic contract and an e-contract?

Much like electronic signatures and e-signatures, electronic contracts and e-contracts are different names for the same thing. These two terms are used interchangeably and mean the same thing. The term “electronic contract” is slowly becoming the preferred term, while “electronic contract” (or e-contract) is going out of favor.

Is signing a contract digitally legal?

It’s important to note that you should always check the laws relating to e-signatures and electronic contracts for where you are, as this article does not provide legal advice and should not be interpreted as such. However, generally speaking, yes, signing electronic contracts is legally binding in most countries.

Is a digitally signed contract binding?

Generally speaking, yes, they are. Different countries have different laws about the legality of and ways in which e-signatures can be used. Presently, e-signatures are legal in over 180 countries. You should always verify your country’s laws on the matter. We always recommend that you check the laws that would apply to you, as this FAQ is not intended as legal advice and shouldn’t be used as such.

How do I legally sign a document electronically?

Because of the legislation that has been enacted by many countries, e-signatures now share the same legality as pen-and-paper contracts. This means that an e-signature and a electronic contract are legally enforceable and are just as valid as traditional signatures and contracts. Signing documents electronically is as easy as tapping the screen in the correct field and adding your signature.

Can you sign a contract with an electronic signature?

Absolutely! This is also an easier solution compared to needing to print, sign, scan, and return a contract. It is also safer and can be finished in moments using a smartphone, tablet, or PC. Because of this flexibility, you can also sign these contracts anywhere that you have access to the Internet.

Can I use e-signatures on any document?

While the vast majority of documents in the vast majority of countries can be signed using e-signatures, unfortunately there are still exceptions. There are always going to be some sorts of documents that require pen-on-paper signatures.

Some common examples of these exceptions are marriage and divorce documents, wills and testaments, court orders, real estate purchase agreements, and termination of insurance. These examples are almost always very specific cases where it makes sense that a person would have to be present for the signing, often in the presence of a lawyer and/or notary public.

What is an example of an e-signature?

There are many different things that can be used as an e-signature: an image of your actual signature, stylized text, a seal, or an e-signature drawn using a mouse or touchpad. Anything that you use to sign a electronic contract can be an e-signature.

What is a “wet” signature?

A “wet” signature is another name for your traditional handwritten signature. They are called this to distinguish them from e-signatures. SignTime’s proprietary wet-ink-like signature tool allows a user to create a signature that looks like it was signed with a pen.

What’s the difference between electronic signature and e-signature?

Both electronic signatures and e-signatures are generally synonymous and are treated as such. You may also see terms like “e signing” or “e signatures” used as well. The term e-signature seems to be more commonly used, but the two terms mean the same thing.

Which is better, an e-signature or a digital signature?

Both terms are often used interchangeably, but there is some nuance to this difference. Digital signatures are technically a security measure to prevent tampering or counterfeiting. Some companies use digital signature to mean e-signature to cause confusion, but SignTime sticks to the term e-signature.

Is it okay to use an e-signature?

Absolutely. They are safe, effective, and fast. e-signatures can greatly simplify many elements of your business and save you money. Because of how e-signature services are stored and accessed, they are safer than their pen-and-paper alternatives. They are used in over 180 countries, ensuring that doing business in other countries is easy as well.

How do I get an e-signature?

There are lots of different ways to get an e-signature. SignTime gives you several options, including a “handwriting” tool to make your e-signature similar to your handwritten one.

Why do we need an e-signature?

An e-signature is an effective way to improve the workflow of your company, cut down on costs (no need to buy paper, ink, printers, etc.), and empower your sales team to close sales more effectively. It’s a simple and straightforward way to make your business better.

Are e-signatures good for business?

Yes. e-signatures and electronic contracts are an incredibly effective way of improving your business’ operations, HR department, and sales team. By making your files easily accessible and highly protected, you can make your business more reliable. Customers are always looking for reliability and security, and e-signatures are a great way to provide that to them.

How do I digitally sign a electronic contract?

Using an e-signature is the easiest choice. Generally, you would tap on the necessary field to fill in (“sign” for example) and then select your signature. The digitized signature is automatically added to the document and you’re finished. If you weren’t using an e-signature, you’d fall into the print-sign-scan-send spiral.

How do I digitally sign a PDF contract?

When you receive a PDF contract, you want to review all the details of the contract carefully. When you’re ready to sign, you tap on any necessary fields that need to be filled in by you, and then you select your signature. The electronic contract does the rest, applying your signature (or date or initial) to the field you’ve selected and finalizing the document. Once you’ve signed the contract, you can send it back.

How do I get a electronic contract signed?

Because of the simplicity of e-signatures and electronic contracts, getting a electronic contract signed is as easy as selecting the fields that the other party needs to fill in (date, sign, initial, etc.) and then sending them the document. When they receive it, they add the dates and digital signature, and then send it back. It’s that easy!

How much does not having an e-signature service cost you?

The answer to this question can vary quite significantly, but e-signature services almost always have major impacts on costs. Because they take less time, the number of hours taken to do projects decrease, and your team has more time to focus on other projects. e-signatures also eliminate the need for paper contracts and decrease expenditures on things like ink, staples, paperclips, courier services (to send and receive paperwork), etc. The biggest cost saving is probably the reduced real estate expenses of housing all of those contracts in larger and larger offices.

A medium-sized company’s savings could be thousands of dollars, or even tens of thousands of dollars. It’s important to take a look at your expenditures and how those would change to get a better idea of more exact savings.

How much does an electronic signature service cost?

Services vary in price and generally have different benefits. SignTime’s free trial will let you test the services for free so that you can see how they’ll benefit your company. The free trial will make it easy to see how SignTime can save you money by streamlining your process compared to traditional signing options. When time equals money, spending less time on a project means you’re saving more.

What is the best electronic signature software?

There really isn’t a “one size fits all” solution that handles all businesses. That’s why at SignTime we offer different packages, from our free trial to our Professional option that permits unlimited users and offers a number of important benefits for large companies. We also have an Enterprise option for those companies that need customized APIs and extra security measures. It’s important to consider what options are available to you and what you need a service to do.

Is there a free e-signature service?

SignTime offers a free trial for you to test the service. We’re confident that once you see the impact that it can have on your business you’ll see the value of having a strong e-signature solution in your toolbox. 

Is SignTime a digital or electronic signature?

SignTime is a electronic contracting service, meaning that it handles the entire process, from drafting to storage, and not only the signing part. SignTime’s e-signatures are certified, secure, and legal, making sure that your contracts have the same legal validity and enforceability as handwritten contracts (when they are executed following local e-signature laws). SignTime uses the term “e-signatures” instead of “digital signatures.”

What is an e-signature differs by department

There are many ways that e-signatures can have a positive impact on your business. e-signatures and electronic contracts can help your sales team close sales, improve your HR department’s ability to get contracts signed, and decrease expenses.

SignTime’s answer to the question of “what is an e-signature?” is simple: “one of the best and easiest tools you can use to improve your business.” You can save money and improve productivity while at the same time optimizing your customer experience and increasing sales.

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