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Everything You Need To Know About Digital Signature Software

The modern world is increasingly becoming digitized. Everything is carried out online. Now, when it comes to signatures, previously, it was a norm always manually to sign essential documents. However, with the advent of technology, even this activity can be carried out digitally. This is where an electronic signature software comes in.

So, What Is a Digital Signature Software?

A digital signature is like an electronic ‘fingerprint.’ It is a modern alternative to handwritten signatures generally used as proof of identity on several documents. Besides, digitally signed documents do have the same legal importance as the handwritten ones. A digital signature is generally validated by certified authorities or trust service providers to verify the security and their authenticity. A valid digital signature, where the essentials are satisfied, gives the recipient a strong reason to believe that a known sender creates the document, and nothing has changed in the message during transit.  E signature software is vital to ensure document security and safety. When any documentation contains an electronic sign, the receiver knows that the document has not been tampered with. And even if someone interferes with the doc during the sending process, the recipient will be able to catch it quickly.

Digital signatures are a standardized element of most cryptographic protocol suites. And it is used typically for the distribution of software, financial transactions, and some cases where it gets crucial to detect any forgery or tampering with documents. If adequately implemented, digital signatures are tough to forge as compared to the handwritten type. The concept of a digital signature or more widely speaking electronic signature, is not new, with official law authorities having recognized telegraph signature as far back as the mid-19th century and faxed signature since the 1980s.

Try not to confuse a digital signature with an e-signature. E-signature is legal but distinct from a digital signature; an electronic signature often uses a cryptographic mechanism. Moreover, an electronic signature can be as simple as a name entered in an electronic document. Besides, digital signatures are increasingly used in e-commerce and in any regulatory filing to apply an electronic signature in a cryptographically secure way.

On the other hand, digital signature certificates are complete with the individual’s name, his or her pin-code, the respective country of origin and email address, the certificate issue date, and the name of the certifying authority. When a certificate accompanies any e signature, it gives further validation to the digital signature system.

Several countries have distinct rules for digital signature systems. Their respective governments have devised various rules, which govern the creation and usage of e signature tools. These regulations have helped in making digital signature tools more reliable, trustworthy, and dependable. The best electronic signature software increases the efficiency of business operations and communication. With the advancement in the technology of e signature tools, we can expect paperwork to become obsolete.

In case you are confused about the legality and enforceability of such sign software; The E.U coursed the E.U. Directive for Electronic Signatures in 1999, and the U.S. passed an act: Electronic Signatures in National and Global Commerce Act in the year 2000. Both these acts made electronically signed contracts or any other documents legally binding, similar to paper-based agreements. By now, most of the countries have adopted legislation and regulations fashioned after the U.S. or the European Union, with an inclination in several regions for the E.U. model of locally controlled, digital signature technology-based e-signatures.

How a Digital Signature Software Works

A digital signature software is designed to help people and companies sign off on business documents or any other document from anywhere without being physically present to sign. Digital signature software uses a standard and accepted format, called Public Key Infrastructure (P.K.I.), to ensure a high level of security and universal acceptance. P.K.I. Requires the source to use a mathematical algorithm to create two large numbers, called keys, one essential public, and the other, private. The numerical algorithm acts as a code, organizing data, matching the signed document; this is called a hash, and now that data is encrypted, this resulting encrypted data is the digital signature. The signature attests with the time that the document is signed. If the document alters after signing, the digital signature discredit takes place.

Consider an example. Bruce, who is a user of online signature software, signs an agreement selling a timeshare using his private key. The customer receives the document. The consumer who obtains the files also gets a copy of Bruce’s public key. If the public key cannot decode the signature (using the cipher from which the key was generated), it means that the signature is not Bruce’s, or has changed since the document was signed. The stamp is now considered invalid.

To ensure the integrity of the signature in the sign software, P.K.I. Requires that the keys are created, conducted, and saved securely and often needs the services of a reliable Certificate Authority (C.A.). Online signature software providers have to meet P.K.I. Requirements for secure digital signing.

The process of how a digital signature software works are listed below :

  1. A digital signature software depends upon the public key cryptography mechanism- where encryption and decryption of data take place by a pair of public and private keys.

  2. Whenever you sign any document with a secure sign software, a cryptographic hash generates for the certificate having your private key, and the encrypted hash will be attached to the file.

  3. The document is signed with your private key and transmitted to the recipient with your public key certificate through the online signature software.

  4. The receiving end will now decrypt the hash value with the public key of the sender in the digital signature software.

  5. Now, if the cryptographic hash values match on both ends of the online signature software, the document is considered legitimate.

  6. Hence the digital signature software assures authenticity and integrity superior to any ordinary signature.

There are several online signature software available in the market. These secure sign software platforms enable individuals and business persons to put their signature and manage docs from any computer using electronic signature software with an internet connection. Several online signature software provides e-signature products available for free on iPhone, iPad, and Android devices, which lets one upload docs from their smartphone's email and camera or a Dropbox account and insert your signature.

Depending on the certificate authority you use, you are required by the online signature software to supply specific information. There also may be limitations or restrictions as to whom you send documents for signing purposes and the order in which you post them through the online signature software. The interface of such e-signature software walks you through the whole process, ensuring that you meet these requirements. When you receive any document for signing through email, you have to authenticate as per the certificate authority’s prerequisites and then sign the document by filling a form online through the online signature software. 

Digital Signature vs. Electronic Signature

The full category of electronic signatures (e-signatures) includes several types of electric signs. A group comprises digital signatures, which are a specific technology application of electronic signatures. Both digital signature software and other e-signature software allow you to sign documents to authenticate the signer. Though, there are differences in purpose, technical execution, geographical use, legal and cultural standing of digital signatures versus other types of e-signatures.

Below, bifurcation shows apparent differences between digital signature software and electronic signature software. However, both are types of secure sign software.

Digital signature software

  • A digital signature software contains characters in digital format, representing an individual's identity attached to the document.
  • A Digital signature software uses a public critical cryptography method.
  • Online signature software offers high security, ensuring authenticity and validity.

E-signature software

  • E-signature software uses a digital image of a handwritten signature attached to any document.
  • The E-signature software application uses any electronic authentication method.
  • E-signature software is less secure compared to the digital signature software.

Specifically, the use of digital signature software technology for an e-signature software differs notably between different countries that prefer open, technology-neutral e-signature laws, including the U.S.(United States), U.K.(United Kingdom), Canada, and Australia. Moreover, some countries follow tiered e-signature models that prefer locally generated standards. Such standards are based on digital signature technology. European Union, Asia, and South America are the regions using a tiered signature. Besides, some industries also embrace specific standards based on digital signature technology.

Standardization agencies like the National Institute of Standards and Technology (N.I.S.T.) or the Europian Telecommunication Standards Institute (E.T.S.I.) provide standards for implementation of digital signatures.

Digital Signature Software Features

1. Document Signing

Document signing software enables you to import and sign business documents with ease, along with security.

2. Mass Sending

The software can send documents to more than one recipient

3. Signing Workflow

It allows users to clarify the signing order when sending a document to multiple recipients.

4. Tracking Document Progress

The software keeps the user aware of who has signed the documents and who are yet to sign them.

5. Notifications+Reminders

User can choose to inform the signers and the requesters of the progress of the signature process

6. Probing Trails

Comprehensive probing trails and reports that track the user activity 24/7.

7. Integration

Works fine with popular applications and offers APIs to build custom integrations.

8. Rebranding

It allows the user to customize the software and legal disclosure along with email templates grounded on the requirements of your company.

9. Mobile Application

Online signature software provides users the power to sign documents from anywhere.

10. Regulatory Compliance

Digital signature software gives to all current laws and offers the highest levels of data security and privacy.

Benefits of Digital Signature Tools

  1. Digital signature tools offer a gamut of benefits. They can be used anywhere and by anyone. The scope is simply limitless. 

  2. To begin with, you can use digital signature tools for personal work. For instance, you can start sending signed documents electronically for enhanced security. That being said, you will also contribute to the environment if you adopt a more digital way of life.  

  3. In the business scenario, you can install one of the best e-signature software and use it to send out digitally signed documents to business partners, stakeholders, clients, and investors. This is hugely beneficial when you are sending out sensitive and vital information. The tool can also be used while finalizing business deals and proposals.

  4. The best e-signature software can be used in all spheres of business, such as architecture, engineering, and construction companies. Professionals from these segments can use the software to sign tenders, procurements, and while participating in biddings. Overall, the top electronic signature software makes business operations incredibly seamless and fast.

  5. Another application of e-signature tools is during the return filing of GST. However, this is more beneficial in UK. The UK government had dictated that for faster e-filing of the GST returns, businesses can resort to digital signatures. Top electronic signature software tools can also be implemented when e-filing for income tax returns. 

  6. Again, in the finance and insurance industry, e-signature tools find the maximum usage. This is because these particular segments involve a lot of paperwork. Manual signatures are needed in almost all the documents, including papers for loans, account applications, mortgages, insurance claims, etc. To reduce the mess and to make the entire process more straightforward, digital signatures are beneficial.

Types of Digital Signature Software

Digital signatures can be broadly classified into three major categories.

1. Simple or Class 1

A simple digital signature is the most basic form of an e-sign. Any encryption does not protect it and hence, is not entirely secure. You might have already unknowingly used a simple digital signature. For instance, when you manually sign a document and then scan it, it qualifies as a class 1 digital signature. One more example is the digital signatures seen at the end of an email. Again, when you click the box on the left-hand side of terms and conditions statements, it is also a simple e-sign. But since this type of digital signatures is not encrypted, it does not display the real identity of the sender, and cannot detect alterations in the form after it is signed, it is not secure. It is quite easy to duplicate class 1 e-signatures.

2. Basic or Class 2

Digital essential signatures are almost similar to simple digital signatures. However, there is a difference. The basic e-signs can detect changes in the document after it is signed. But it cannot show the real identity of the sender and uses asymmetric cryptography. The whole signing procedure is carried out via 2-factor authentication. Therefore, the resultant documents do not have legal authenticity.

3. Advanced or Class 3

Advanced & Qualified digital signatures are recommended to be used by businesses. It is the most secure form of e-signing any document. It is on par with real-time, manual signatures on paper. Class 3 digital signature tools are created through asymmetric cryptography and critical public infrastructure. It shows all the changes in the document during the sending process and also displays a verified user identity. Such tools use the 2-factor authentication methods, which include sending an OTP to registered mobile numbers and biometric scanning.

Digital signatures can be traced back to several years if you ask about its original inception. But they have progressed with technology. If your business involves a lot of paperwork, you should give e-signature tools a try.

Applications

Digital signatures apply in various departments for many purposes. Some of the most common applications of online signature software are as follows:

1. Finance

  • To sign internal and external audits

  • To sign loan agreements

  • To sign expense reports

  • To manage assets

  • To sign invoices

2. Sales & Marketing

  • To obtain a consumer's signature while signing-up a product

  • To obtain signatures of attendees in an official event or training

  • To get permission from consumers with their signatures

  • To sign a sale processing Integration with CRM software

  • To sign an agreement of partnership

  • To include or exclude a new vendor

  • To sign press releases

3. Information technology

  • For managing and I.T. policy

  • To manage the release

  • To manage change

  • To manage the assets

  • Product roadmap

4. Human Resources

5. Legal

  • For signing Non-Disclosure Agreements (N.D.A.)

  • To sign business contracts or agreements

  • To sign lease agreements

  • To manage policies

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Payal PatilBy Payal Patil | Last Updated: October 26, 2020

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