Electronic signature: what is it and how to use it

What is electronic signature? 

An electronic signature, commonly referred to as an e signature or e-signature, is a digital way to sign documents with the same legal weight as handwritten signatures, showing a person's intent to agree to a document's terms. It's agreeing to terms or contracts through electronic means. Using methods like typed names, check boxes, biometric data, or digital certificates to verify identity and intent, e-signature solutions provide verifiable, legally binding proof of consent. By capturing metadata such as IP addresses and timestamps, they often offer stronger evidence than traditional signatures. Seamlessly integrating with business workflows, e-signatures combine legal compliance with convenience, making them essential for businesses digitising operations.

How to create an electronic signature? 

Creating an electronic signature is straightforward and can be accomplished through several methods. Most electronic signature software and e-signature solutions offer user-friendly interfaces that guide you through the electronic signing process step by step. To create an electronic signature, you'll typically need to upload or create your document, add signature fields where required, choose your preferred e-signing method, verify your identity through the chosen authentication process, and apply your signature to complete the document.

How to create an electronic signature free 

When it comes to free electronic signature options for individuals, Dokobit stands out. With Dokobit’s free eSignatures, individuals can easily sign documents online without worrying about hidden costs or complexity. The platform is designed to meet the highest security and compliance standards, ensuring the signed documents are handled safely and by regulations like eIDAS. Dokobit also offers a great and efficient experience for businesses to handle their important documents and contracts electronically.

How does an electronic signature work?

Electronic signatures use authentication and encryption to verify signer identity and document integrity. The document owner sets signature fields and authentication requirements. Recipients verify their identity via email, SMS, eID, or eIDV before e-signing, depending on the level of assurance required. Once signed, the document is encrypted, and an audit trail is created (with identity verification details, timestamp and geographic location, device and browser information, document access and completion times, and any authentication challenges completed). This ensures document integrity and provides legal evidence of the e-signing event. The completed document is then distributed to all parties whilst maintaining the tamper-evident seal that invalidates the signature if any changes are made.

Types of electronic signatures

Handwritten signature

Digitised handwritten signatures are a digital version of the ink signatures. These signatures are created through scanning signed documents or digitally capturing the signatures through a digital pen or finger. They offer user familiarity, but lack strong authentication and are vulnerable to copying without proper security controls. However, combining them with audit-ready trails, access controls, timestamps, IP logging, and document integrity features can enhance their security and legal validity.

Digital signatures

Digital signatures utilise public key infrastructure (PKI) technology to provide the highest level of document security. PKI creates mathematical algorithms that generate unique key pairs for each user—a private key for digital signatures and a public key for verification.

Biometric signature

Biometric signatures capture unique physical characteristics of the e-signing process. Biometric methods offer excellent security because they rely on characteristics that cannot be easily replicated or shared. Some of the most used biometric authentication and verification methods are fingerprint or facial scanning for mobile device signatures, and facial recognition for identity verification (especially for advanced electronic signatures or qualified electronic signatures). This technology ensures:

• Non-repudiation (signers cannot deny their signature)
• Authentication of the identity of the signatory
• Sensitive data integrity protection in electronic transactions
• Timestamping capabilities for signed documents

Simple electronic signature (SES)

Simple Electronic Signatures (SES) offer basic e-signing for low-risk transactions, such as typed names, scanned signatures, or tick boxes. While a less secure electronic signature than advanced options, SES are legally valid electronic signatures for many business uses and provide greater convenience than paper-based processes.

Advanced electronic signature (AES)

Advanced Electronic Signatures offer enhanced security features versus the simple electronic signatures. The advanced electronic signature provides strong authentication through multi-factor verification and maintains comprehensive audit-ready trails. Key characteristics include:

• Unique identification of the signatory
• Sole control by the signatory during creation
• Detection of subsequent changes to signed data
• Strong authentication processes

Qualified electronic signature (QES)

Qualified Electronic Signatures represent the highest level of security in digital authentication, great for signing high-risk contracts electronically. QES requires sophisticated cryptographic techniques and must be created using qualified electronic signature creation devices certified by accredited authorities, such as qualified trust service providers. This signature type provides top-notch security for the business processes that require the highest assurance, through:

• Advanced cryptographic protection
• Qualified digital certificates issued by trusted certificate authorities
• Tamper-evident technology that detects any document modifications
• Legal presumption of validity in court proceedings

Learn the differences between advanced electronic signatures vs. qualified electronic signatures.

Legality and compliance of electronic signatures

Electronic signature legality varies across jurisdictions, with most developed countries recognising their validity through comprehensive electronic signature laws. The European Union leads global electronic signature regulation through the eIDAS regulation (electronic Identification, Authentication and trust Services), which provides a harmonised approach across member states and can't be overruled by other federal regulations. It recognises three signature levels: simple electronic signature, advanced electronic signature, and qualified electronic signature. Key legal principles governing these e-signatures include:

• Legal equivalence to handwritten signatures for most transactions
• Technology neutrality allowing various signature methods
• Consent requirements ensuring voluntary adoption
• Audit obligations for evidence preservation
• Specific exclusions for certain electronic document types

Organisations must understand applicable regulations in their operating jurisdictions to ensure compliance. This includes selecting appropriate signature types, maintaining proper documentation, and implementing security measures that meet legal requirements.

Are electronic signatures legally binding in Europe?

Electronic signatures are legally binding across European Union member states under the eIDAS regulation, established in 2016. This framework defines three levels of e-signatures (SES, AES, and QES) with varying legal presumptions and security requirements, providing legal recognition across the EU, clear standards for signature types, trust service provider requirements, and cross-border interoperability. Electronic signatures cannot be denied legal effect solely because they are in electronic form, with qualified electronic signatures carrying the strongest legal presumption, equivalent to handwritten signatures, while SES and AES may require additional evidence in legal disputes. European courts consistently uphold the validity of e-signatures when proper procedures, such as demonstrating signer consent, maintaining document integrity, and preserving audit trails, are followed.

Benefits of electronic signatures

Benefits of electronic signatures for your businesses

• Less document processing time
• Cut administrative costs
• Improved customer satisfaction through easier and faster processes
• Enhanced security compared to paper-based signatures
• Audit-ready trails for compliance requirements
• Environmental benefits through reduced paper consumption
• Global accessibility enabling remote operations

Benefits of electronic signatures for your users

• Signing from any location, at any time
• Faster transaction completion
• Reduced travel requirements for electronic document signing
• Enhanced security of personal information and other data
• Permanent digital records of signed electronic documents
• Integration with mobile devices for on-the-go signing

How to create electronic signatures

Creating effective e-signatures requires choosing the right platform and following best practices for implementation. Consider factors such as security requirements, integration capabilities, and user experience when selecting your solution. Most platforms offer intuitive interfaces that guide users through e-signature creation, electronic document preparation, and distribution processes. Look for electronic signature solutions that provide:

• Multiple authentication options
• Mobile compatibility
• Integration with existing business systems
• Compliance with relevant regulations
• Comprehensive audit capabilities

Ensuring the validity of an electronic signature: key factors for an electronic signature valid across Europe

• Verified signer identity through appropriate authentication
• Clear indication of intent to sign the document
• Tamper-evident technology to detect alterations
• Comprehensive audit trails documenting the e-signing process
• Compliance with applicable legal requirements
• Proper document retention and archival procedures
• Regular audits of your electronic signature processes

When to use an electronic signature in real life: industries and use cases

Electronic Signatures in Healthcare

Healthcare organisations utilise electronic signatures for patient consent forms, medical records, insurance documentation, and regulatory compliance. The technology ensures legal compliance while improving the patient experience through faster and simpler administrative processes.

Electronic Signatures Financial Services

Financial institutions rely on electronic signatures for loan applications, account opening procedures, investment agreements, and regulatory filings. The enhanced security features meet stringent compliance requirements whilst accelerating customer onboarding.

Electronic Signatures in e-commerce

E-commerce platforms integrate electronic signatures for terms of service agreements, vendor contracts, and customer authentication. This technology reduces cart abandonment rates and improves transaction security.

Electronic Signatures in Banking

Banks implement electronic signatures for account management, loan processing, and investment services. The technology enables remote online banking services whilst maintaining the security standards required by financial regulators.

Other common document types suitable for e-signatures include:

• Sales contracts and purchase orders
• Vendor contracts and supplier agreements
• Real estate contracts and property transactions
• IP licensing agreements and intellectual property transfers
• Legal documents and agreements used in court
• Non-disclosure agreements (NDAs)
• Employee contracts and HR documentation
• Commercial contracts and business agreements
• Corporate resolutions and board minutes
• Software and content licensing agreements
• Consumer transactions and retail agreements
• Procurement documentation
• Government digital forms and public sector applications
• Shipping physical documents and logistics paperwork

Frequently Asked Questions (FAQ)

Are Electronic Signature and Digital Signature the same?

No, e-signatures and digital signatures are different technologies. Electronic signatures provide a broad category of digital signing methods, while digital signature processes normally use PKI cryptography for enhanced security. Digital signatures represent a subset of electronic signatures with additional technical requirements.

What is an e-Signature Date?

An e-signature date represents the timestamp when the electronic signature was applied to the digital document. This date provides legal evidence of when the e-signing occurred and helps establish the validity timeline for contractual obligations.

What does a wet signature mean

A wet signature refers to a traditional handwritten signature made with ink on paper. The term "wet" comes from the ink being wet when initially applied. Understanding the wet/ink signature meaning helps distinguish between traditional and electronic signing methods.

Can an e-signature be forged?

Yes, an e-signature can be forged, but the most advanced e-signature platforms utilise advanced security measures like encryption, AI-based ID verification and authentication protocols, and audit trails, among other features, to minimise risks. These measures not only help verify the identity of the signer but also track any alterations, making it significantly harder to falsify e-signatures compared to traditional signatures.