The role of signatures
Before we go into the benefits of electronic signatures, how to ensure their authenticity, and so on, here are a few fundamental pieces of information that are important to note.
What is a signature?
- It is used as uniquely personal, undeniable self-identification or physical evidence that the person involved in the contract is witnessing and certifying the contents of the documents.
- Put simply, it is a written promise and an anchor of trust and evidence.
The impact of a signature
- The reason why we need signatures is to legally anchor people to the agreement to create an actionable reality.
- An agreement or “contract” without a signature is completely open and ambiguous and incredibly hard 一 if not impossible 一 to enforce.
What does a signature convey?
- The identity of the parties entering into a contract
- The definite acceptance of the contract by the parties themselves
- The applicability of the terms and conditions of the contract with the parties
The benefits of electronic signatures
- Signatures create trust and credibility.
- Contracts can become tangible, preservable, and visible.
- Signatures signify a commitment to a transaction.
- Signatures make it more difficult for the same party to backtrack from commitments.
What electronic signatures are in Singapore
As previously mentioned, amidst the COVID-19 pandemic, electronic signatures experienced a significant rise in popularity and their growth appears to be exponential.
An electronic signature is an acknowledgment provided in an electronic format that an individual or business can use to demonstrate acceptance by a party. It can also be used to authenticate the party involved.
Electronic signatures aren’t necessarily always written signatures. Sometimes they can be in the form of a symbol. Here are a few other forms of electronic signatures:
- A scanned physical signature
- A drawn signature on an electronic device
- Clicking “I agree” to terms and conditions on a website
- Typing your name at the signature portion of an online form
When reading about electronic signatures in Singapore, you may also come across a term called ‘digital signature’. Upon first glance they may seem very similar, however, they have very distinct differences.
- Digital Signature (Encryption/Decryption Technology) - Digital signatures support electronic signatures. They secure sensitive data, detect tampering efforts, and strengthen signing trust.
- Electronic Signature (Legal Concept) - Electronic signatures only show who signed, what was signed, and the intent and consent of the parties.
The legality of electronic signatures in Singapore
Electronic signatures are recognised under Singapore’s Electronic Transactions Act 2010 (ETA). They may be accorded the same legal status as a “wet ink” signature, provided that the following requirements are met:
- The electronic signature is unique to the person using it.
- The electronic signature is capable of identifying such a person.
- The electronic signature is created in a manner or using a means under the sole control of the person using it.
- The electronic signature is linked to the related electronic record such that if the record was changed, the electronic signature would be invalidated.
Furthermore, it has to be created during the operational period of a valid certificate. Such certificate must be issued by:
- An accredited certification authority
- A recognised certification authority
- A public agency approved by the Minister for Communications and Information to act as a certification authority
- The parties have expressly agreed between themselves (sender and recipient) to use a digital signature as a security procedure, and the digital signature was properly verified by reference to the signatory’s public key
The benefits of electronic signatures
It has been no surprise that electronic signatures have undoubtedly facilitated a shift in the workplace, and there is a vast array of benefits to support why we should switch to this non-traditional digital transformation solution.
Here are just a few benefits of electronic signatures:
- Simplified HR process
Contract management is just one of the many responsibilities of an HR department. Proper management of important documents is essential for businesses to grow and also protect themselves from any potential risks.
As businesses grow, so do the number of employees, which translates to piles and piles of contracts whether it be for full-time or part-time workers. If you’re manually trying to manage these contracts, it can become extremely overwhelming very quickly.
However, electronic signatures can help make the process easier and faster by enabling speedy approvals and eradicating unnecessary back and forth. This means agreements can be concluded more effectively and the closing time for contracts can be decreased.
- Efficient contract management
With electronic signatures you will often have a centralised location to store all of your documents. For example, one of Lexagle’s contract management features is its legally-binding electronic signature that allows users to sign and collaborate on documents within the platform, which keeps everything moving fast and smoothly.
Here are a few other examples of what our contract management platform, Lexagle, can do:
- Easily place where you want the e-signature fields to go.
- Quickly add in a title for the signee.
- Send or Bulk Send to quickly shoot off any contract.
- Control the order of signers to ensure that disclosures have been read and accepted prior to signing.
Before automated systems, having to manually get signatures for each document can wind up taking days, which puts the whole process on pause. This can frustrate your top talent or clients who have inevitably grown accustomed to everything being done instantly in our rapidly moving digital landscape.
- Less money on archiving and storage
Electronic signatures can often come hand-in-hand with a contract management platform. By switching to a digital solution like Lexagle, businesses can remove the need for travel to physically sign documents, which means less waiting time. In addition to this, businesses can also save salary costs due to a reduction in manpower in waiting time.
Establishing a system for electronic signatures is also more environmentally friendly as it reduces paperwork and helps your business market itself to people who appreciate more environmentally friendly practices.
How authenticity is ensured
Just as a physical signature on a document can be forged, or the physical document be tampered with, so can an electronic signature or an electronic document be forged and tampered with. So how do we ensure authenticity?
When a signer electronically signs a document, the signature is created using the signer’s private key, which is unique and always securely kept by the signer. The mathematical algorithm acts as a code, creating data matching the signed document and encrypting that data. The result is the digital signature.
Software with an embedded digital certificate of the document’s history allows an expert to track the IP address, to see who sent the document, how it was sent, and the date it was accessed and signed. This ensures the genuineness and the authenticity of digital and electronic signatures used in today’s digital age.
Transform your business in our digital era
As the pandemic continues to disrupt our lives, businesses have been led to increasingly conduct business virtually, accelerating existing trends in electronic signatures, remote working, as well as automation. In order to not only survive but successfully grow your business, it's important to embrace this new age of digital transformation.
As Asia’s leading contract management platform, Lexagle can help your business streamline your contract lifecycle from end to end and optimise your processes as our world gears towards a fully digital future. With Lexagle, you’ll also enjoy more automated features such as contract trackers, better document storage, as well as document signing.
If your business is ready for the next step forward in this digital age, do not hesitate to contact us for a free demo today.