Ultimate Guide to Electronic Signing of Contracts
Contracts are only valid if all parties sign them. A contract is legally valid only if all parties sign it. Many contracts require negotiations to be completed before signing. Contract negotiations are difficult when there is a high level of Covid interaction. This makes it more difficult for parties to sign contracts on paper. The solution is to digitize contract negotiations and sign processes to be done entirely on a virtual platform.
The best healthcare contract management software, for instance, is equipped with the most up-to-date workflows and eSignature capabilities. Automated workflows can be customized to suit your company and will automate all aspects of contract management. Contract parties can sign a contract electronically without the need to print it or use a pen. This is a huge benefit for remote workers. Contracts can be signed from any location in the world.
What Is the Working Principle of Electronic Signatures?
Electronic signatures are easy to dismiss as an alternative to ink-to paper signatures because of their simplicity. Electronic signatures are far more advanced than they seem.
Electronic signatures can be used as a full SaaS solution to authenticate, track, and store signatures and information at all stages of a contract’s lifecycle. E-signatures can be signed by only one person, just like handwritten signatures. While witness testimony and handwriting can be used to confirm the authenticity of traditional signatures, e-signatures provide additional layers of authentication.
Each electronic signature is assigned a Public Key Infrastructure (PKI) that appears as a unique sequence of encrypted numbers, one public and one private. The encrypted data contains information about the IP address of the signer and records the date and time at which the signing occurred.
Benefits of Electronic Signatures
Switching to electronic signatures for contract signing at your company has many benefits. Let’s take a look at the most important benefits.
You can save time
To sign a contract with ink and paper, you need a printer, paper, and ink. A scanner can read the signatures on the document. An email is required to return the signed contract. An electronic signature requires a contract management portal that supports eSign capabilities. ESign takes far less time than signing with ink on a piece of paper.
Contract Document Security
E-signed documents can be encrypted to make them more secure than paper-based documents. It is easy to alter paper documents, and the signatures can easily be forged by using a copier. You can sign documents and save them in a secure digital repository by using the right contract management software. Contract management software can detect the smallest of changes and alterations.
Reduce your costs
An electronic signature eliminates the need to print a contract. This saves money on printing machines that scan, copy, ink, or other stationery. There are also errors in the physical signature process, which can lead to higher costs.
Are Electronic Signatures Safe?
When signing a document online, the most common concern is about their personal information. How can you be sure that hackers won’t get your personal information?
Electronic signatures can be as secure as in-person signatures, thanks to the advances made in technology. You can be sure that no one can access your business because they are encrypted and require passwords.
Are They Legal and Legitimate?
They’re convenient and safe, but are they legally binding? If I don’t use pen and paper, how does that count as a valid signature?
These are not uncommon questions. The ESIGN Act, which was passed in 2000, made electronic signatures legal. It is legal and contractually binding if you sign it. You can also be held responsible for it.
Who Uses Electronic Signatures?
Remote work is becoming more common than ever. Signing documents remotely is not only a time-saver but a necessity. Businesses in almost every industry can use e-signatures to automate their contract lifecycles. Here are some key functions and industries in electronic signatures that are often used:
- real estate transactions
- sales contracts
- Onboarding HR/employee
- government services/applications
- financial services
- Intellectual property licensing
- Non-disclosure Agreements
- age verification
You should ensure that electronic signature integration is possible if you have an existing contract management system. You should ensure that your contract management software has all of the necessary features for managing them. You should have to be able to customize the features of the contract management software you choose. When choosing a contract management system, you should consider customization capabilities.
The best online contract signing software can help you digitize and streamline your contract management. Contract management is an essential enterprise process that is highly vulnerable to risk. These risks can lead to legal problems that could be costly for budgets. You can avoid these risks by using a contract management program with an e-signature option to streamline your operation and save money. Contract management encryption also protects your documents.
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