What is document signing?
Document signing is the process of adding a digital or e-signature to a document in order to provide the identity of the sender. Document signing electronically eliminates the need for physical paper documents and dramatically speeds up the signature process.
Document signing is often a critical part of any contract and plays an important role within the contract management software and proposal software space. Document signing streamlines the flow of documents with multiple features designed to simplify document creation, establish workflows, and remind parties to submit signed documents. Many industries, including banking and real estate, depend on document signing to support their day-to-day business operations and finalize contracts in a timely manner.
Types of document signing
Businesses use various forms of digital document signing to finalize different types of contracts and documents. It’s important to understand both the software that provides users the ability to sign documents as well as the various standards that have been established for document signing. In terms of software there are generally two common types:
- E-signatures: E-signatures are the most common way to electronically sign a document, which is accomplished by making use of e-signature software. It is a digital form of a signature that is legally binding and secure but it does not incorporate any coding or standards. Businesses use e-signatures when they only need to verify the document. For example, an e-signature can include a photocopy of a handwritten signature, a typed-out drawn signature, or even just clicking an “accept button”.
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Digital signatures: Digital signatures are another common form of document signing, but in contrast to e-signatures, digital signatures are generally more secure. With a digital signature, users are required to have a digital certificate so that he or she can be linked to the document. A digital signature is often authorized by certification authorities that are responsible for providing digital certificates that can be compared to licenses or passports. A digital certificate is used to validate the document to determine its authenticity. This is critical in order to verify the identity of the original person with the signature.
In addition to software, there are also different standards set for document signing in terms of security and validity. These standards are set by the European Union regulations and are slowly being adopted worldwide. Those standards are as follows:
- Standard electronic signatures: Standard electronic signatures do not require user ID verification. They can be used with e-signature software and they include scanned signatures and using an “I accept” button.
- Advanced electronic signatures (AES:): AES is used for legally valid electronic signatures. These signatures are uniquely linked to the signer, can identify the signer, and can reveal any changes in the signed data. This type of document signing is often completed using two-step verification which provides that second layer of verification. An example of this can be an application on your mobile phone that a signatory needs to use in order to validate that their signature on an electronic document was actually done by themselves.
- Qualified electronic signatures (QES): QES provides the highest security and legality requirements of all digital signatures. Qualified signatures provide added security by a third-party Trust Service Provider (TSP). These may be necessary for documents that need high security such as property transfers, legal contracts, incorporations, and many other corporate and government interactions.
Benefits of document signing for businesses
It’s important to outline the benefits of the document signing process as well as the benefits of digital signature software:
- Allows users to authenticate a binding contract or agreement
- Provides users with a document of record to prove what was agreed upon
- Provides a means of understanding between a buyer and seller
- Provides a faster contract turnaround, a reduction of bottlenecks, and real-time regulatory compliance.
Basic elements of document signing
Some elements fundamental to document signing include:
- Document signing: Document signing allows the signer to easily and intuitively sign documents.
- Reminders and expirations: This feature reminds signers of documents that are waiting to be signed and of document expiration dates.
- Sign-in process: The sign-in process or the process of authenticating is secure and seamless.
- Mobile signatures: Users can easily send and sign documents on mobile devices.
- Signature workflow: Senders, administrators, or both can easily set up and track documents through multiple signature steps.
- Bulk digital signatures: Document signing provides the ability to send documents requiring thousands of signers at once.
- Reporting: Reporting feature helps provide standard reports and facilitates the easy creation of custom reports to manage the signature process.
- Signature document creation: Document signing provides easy to create signature blocks on all required electronic document types or forms.
- Regulatory compliance: The software meets the required regulatory compliance.
- Signature history and audit: This feature helps track all document signing history to comply with required regulations.
- Enterprise scalability: Document signing provides features to allow scaling for large organizations.
- Custom branding: Custom branding can be applied through the signature process.
Document signing best practices
To make the best use of document signing solutions, companies should follow these best practices:
- Ask questions about any clauses that may seem questionable
- Consider particular business goals in signing the document
- Have multiple stakeholders look at the document to ensure nothing significant is missing
- Understand whose signatures are necessary to complete the document
Michael Gigante
Mike is a former market research analyst focusing on CAD, PLM, and supply chain software. Since joining G2 in October 2018, Mike has grounded his work in the industrial and architectural design space by gaining market knowledge in building information modeling, computer-aided engineering and manufacturing, and product and machine design. Mike leverages his knowledge of the CAD market to accurately represent the space for buyers, build out new software categories on G2, and provide consumers with data-driven content and research. Mike is a Chicago native. In his spare time he enjoys going to improv shows, watching sports, and reading Wikipedia pages on virtually any subject.
