For most people who enter into contracts on a daily basis, the terms “electronic signature” and “digital signature” mean roughly the same thing. From a legal perspective, however, an electronic signature and a digital signature are two very different forms of consent.
Whether a signature is electronic, digital, or handwritten on paper, the underlying concept remains the same. All three types of signatures represent the intent of the person signing a document. Although the terms “electronic signature” and “digital signature” are often used interchangeably in conversation, they do in fact have distinct meanings from both a technical and a legal perspective.
At its core, an electronic signature can be any type of electronic consent or approval. More specifically, the E-Sign Act defines an electronic signature as an “electronic sound, symbol, or process attached to or logically associated with a record and executed or adopted by a person with the intent to sign the record.”
So what does that mean? In layman’s terms, it means that an electronic signature can be any type of audio file, a graphic representation, or a procedure that is somehow associated with an electronic record. It can be something as simple as a written name or a button that says “I agree,” or as complex as a biometric signature.
It is important to remember that not all electronic signatures are weighed equally in the eyes of the law, and a signature that cannot be verified for integrity and security is going to be less defensible in court. That is one of the reasons why many professional businesses require that customers and clients do more than just type in their names or click “I Agree” when they sign important documents electronically. This is also why most companies require that clients use defensive e-signature platforms when entering into any type of binding agreement.
Entering into an agreement with a digital signature is somewhat more complex than using an electronic signature, although both types of signatures can be used by people to indicate consent or agreement to a document.
By most definitions, a digital signature is similar to a rubber stamp – with the main difference being its digital nature and the fact that certain bits of unique personal data must be hidden within the digital stamp to ensure its security and verifiability.
Digital signatures are also frequently compared to fingerprints, since each contains a unique set of data that is hidden to the human eye. With digital signatures, this data is placed within the computer code and it can be used to indicate consent and to prove whether a “signer” has created or modified a file. If anything within a contract is changed or altered after the digital signature has been put in place, then that change will be noted and the contract will become invalid. This ensures the integrity of every contract and helps protect against forgery, which is a common concern with electronic contracts in general.
Digital signatures are an excellent tool that businesses and consumers can use to authenticate contracts that are signed electronically, however the process of creating a digital signature can be somewhat complicated for most people without computer backgrounds. That’s why many businesses that use digital signatures do so with the help of a platform or a tool like RightSignature. Documents executed with RightSignature contain the most critical elements of both electronic signatures and digital signatures, which ensures that any contracts being signed electronically will be just as legally defensible – if not more so – than contracts signed with pen and paper, should the issue ever be brought to court.