The world has gone to computers. While they are not taking over the world in a Terminator sense and killing us all, computers have killed paper filing systems and changed business forever – but in a very good way. Paper systems, including electronic signatures (e-signatures), provide a variety of benefits. The following is important for all small business owners to know about electronic signature software and using them in your business:
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1. What is an electronic signature or e-signature?
The Oxford Dictionary defines an electronic signature as, “symbols or other data in digital form attached to an electronically transmitted document as verification of the sender’s intent to sign the document”. Notice that it says “symbols or other data” – it is important to note that an electronic signature does not have to include a person actually signing their names. This is an important distinction: a digital signature is when a person uses digital means to sign their name, for example signing with a stylus on a credit card pad at a checkout counter or signing a digital pad for a delivery. While a digital signature is a type of electronic signature, not all electronic signatures are digital signatures. An electronic signature (or, interchangeably, e-signature) can be signing one’s name, but it can also include checking a box that says “yes” or clicking a link marked “I agree”, or any other form of clicking or entering of data to verify intent.
2. Why are businesses using electronic signatures?
There are a number of reasons that businesses, large and small, are using digital signatures, and why your business should be doing so as well, some of the reasons are: –
a. Electronic signatures help cut costs.
Different businesses use electronic signatures in different ways, but these e-signatures almost always help to cut costs. For example, say that you are designing a product for a customer and you need their approval on a drawing before you can create the mock-up. In the past you would have had to mail or send it by carrier, wait for them to review, sign, and send it back, then have it routed to your desk and open it, review their comments, then perhaps call them to discuss or resend revisions. Today, with e-signatures, a process that might have taken days, or even weeks, in the past can now be done in days, or even hours.
b. Electronic signatures are good for the environment.
E-signatures are also green or eco-friendly in that they reduce physical paperwork, which reduces the need for trees to be turned into paper, ink to print, space to store the paper, fuel to move the paper from place to place, and more. A hard drive doesn’t take up any more space or resources whether it is 100 GB or 1000 GB.
c. Electronic signatures help reduce fraud.
E-signatures can actually help to reduce fraud and error, and to minimize your culpability in a situation. For example, a letter can be delivered to the wrong address, causing slow-downs as well as breech in security. Whereas an email can only go to the account it is sent to, or a log-on will only lead the correct person to the correct website. In addition, encoding technology keeps things secure, and there can be locks placed on things to prevent people from tampering with certain aspects of documents. Are there potential security issues? Sure there are; nothing is 100% secure all of the time, but there are actually fewer potential fraud issues inherent to e-signatures than to paper signatures.
d. Electronic signatures help increase customer satisfaction.
For all of the above reasons – speed, ease, eco-friendliness and security – e-signatures provide customer satisfaction as much as they satisfy you.
e. Electronic signatures give entrepreneurs more time to increase sales. Let’s face it: you are in business to make money, but to do that you need to grow your business, and to grow your business you need to, well, make or save money and free up your time to engage in activities that make your company money. Being able to get an electronic signature quickly and easily keeps you from wasting your time either waiting for paperwork to be sent one way, signed, and then sent back, and keeps you from having to track down written approvals. Instead, your time is available to do what you do best and move your business forward. Of course, sometimes more time is still not enough to make money and you may have to get creative to fund organizational growth. Remember to look for the best price in all your computer and technology systems, to pay off debt when possible without accruing interest, to consider selling structured settlements payments to get the liquid cash you need, or to find other creative ways to make and save money.
3. How Legitimate are E-Signatures?
E-signatures are legitimate, valid, and legal. In fact, it is important to know that e-signatures are totally supported by law. In fact, in 2000, the Electronic Signatures in Global and National Commerce Act (ESIGN) provided legal standing for electronic signatures (Source), while the Digital Signature and Electronic Authentication Law (SEAL) provided more details about using e-signatures at financial institutions (Source). In addition, the Uniform Electronics Transaction Act (UETA) sets standards that have been adopted in most states for obtaining and keeping electronic records and signatures (Source).
The fact of the matter is that moving your small business systems to more paperless filing and to electronic signatures makes sense. It makes sense financially, logistically, security-wise and more.
Joseph Green is a professional internet marketing analyst at Strategic Capital. He believes in providing the best and suitable financial advice. Joseph has vast experience in various financial sectors and specializes in structured settlements. He keeps writing about helpful and practical financial solutions.