The benefits of electronic signing far outweigh those of hand-written signatures, however digitally making copies of electronically signed documents is far too easy. In the digital realm, how do we trace the master document and its owner? Signicat’s cooperation with Enigio using trace:original enables tracing of the document to its digital original.
What are the benefits of electronic signing?
More and more organizations see the benefits of using electronic signatures when signing contracts with their customers. Obvious benefits of electronic signing is that it does not require you to meet in person, and that it’s a lot faster than alternatives, like using the post, or even email. In addition, electronic signatures offer features which make them a lot more secure than handwritten signatures.
One important feature of electronic signing is the integrity of the signed document. Any change to the document after signing will be flagged when viewing the document digitally. With a paper document by contrast, it is possible to go back and make changes after the document has been signed without notifications of a document being tampered with. Several old crime stories have used this in the plot, where the perpetrator has reinserted a signed document into the typewriter and added some words.
Identity verification is a lot better with electronic signatures, where senders are ensured the recipient of signed documents is in fact the intended recipient. In most cases, the handwritten signature does not offer a lot of identification, where senders can not be 100% sure the signature belongs to the intended recipient. Back in the 80's, Konrad Kujau, not only forged a signature, but forged Hitler’s diaries, sold for USD 3.7 million. Although not legal, learning and using somebody else’s signature is not really difficult, and you can easily find resources to help you do so.
Electronic signatures also offer mechanisms to ensure that the document can be validated far into the future, by using a combination of storing long-term-validation (LTV) information within the document, and periodically verifying and re-sealing the document, a process known as preservation. So in these respects, an electronic signature is far superior to a handwritten signature however there is one aspect missing- there is no digital original.
What is a digital original?
With an electronically signed document, you can make as many copies as you like, for example for safe storage in multiple locations. But all the documents are exact copies. There is no such thing as the "original" or "master document" online. For some types of document, this is really important, as the document grants certain rights to the holder of the document or negotiable instrument. One example of an important document is a bill of exchange. This is “a written order used primarily in international trade that binds one party to pay a fixed sum of money to another party on demand or at a predetermined date.” It is similar to a check, and as such, gives the holder of the check certain rights, which can be transferred to others.
An electronically signed document by itself cannot be used as a bill of exchange as there is no owner, and you can make as many copies as you like, considering there is no *original*. To solve this issue, we are now integrating with Enigio’s trace:original offering. This is a technology which allows you to create a document as the original owner, have it digitally signed, and ownership can then be transferred to another individual. This is achieved by a combination of Ricardian contracts and use of a public distributed ledger. This ensures that documents can be transferred to one (and only one) other individual. As usual, only control information (no real data) is placed on the ledger, making this fully GDPR compliant. By using this technology, anyone with a copy of a trace:original document can easily verify if the document is a copy of the current valid original or maybe an earlier verified version of the document. It is also easy for an owner to create a proof that other stakeholders can use to validate the ownership.
If you have questions regarding Digital Originals, please contact us. For more considerations on implementing electronic signing solutions for your business download our eGuide.
John Erik Setsaas
VP of Identity and Innovation at Signicat
July 13 2020