Moving business approvals online without knowing the important steps to take is not an easy task. It’s crucial to understand the potential risks of not ensuring your digital signatures with appropriate authorization. Therefore, updating your authorized signatories list is a vital part when using e-signatures.
If you’re still not using electronic signatures in your business processes, there are also some risks to consider. Moreover, we will discuss the best practices to mitigate the most common issues in adopting e-signing. So, what are the possible disadvantages of not using digital signatures today?
Why You Should Move to E-signatures
Perhaps, you’re still not convinced that digital signatures are safe to use. If so, here are the top 5 risks of not using digital signatures in your daily transactions:
1. Risk of forgery or fraud.
Forgery has been a major concern since people started to sign their names on legal documents. Unlike e-signatures, it is easier to forge a signature on physical documents nowadays. Dedicated electronic signature platforms ensure that authentication issues are properly addressed throughout the e-signing process.
Many electronic signatory software platforms today are equipped with the right tools to prevent hacking or compromising e-signatures and sensitive information. For instance, you can adopt an extra anti-fraud feature such as an authentication confirmation through phone calls.
2. Risk of unverified signer identity.
When you use physical signatures on important documents, there is a risk of unverified signatory identity. Anyone can sign the paper without a verified identity unlike in digital signatures. E-signature technology now provides different options when it comes to verifying the identities of signatories.
Before accessing and signing documents online, it’s a protocol to verify the person’s identity including the email address, access code, ID verification, knowledge-based questions, and phone number verification. It’s a more rigid process than the traditional signing of documents.
3. Risk of unauthorized signing.
Wet ink signatures are riskier of unauthorized signing than electronic signatures. E-signatories are thoroughly checked and appropriately authorized to sign online documents. In addition, they understand what they are exactly signing for.
Organizations are now allowed by blockchain technologies to securely and efficiently manage digital signatories in real-time while having a clear and complete audit trail of any data changes. E-signatures are guaranteed to follow both international digital signature laws as well as local rules and regulations to ensure reliability and security.
4. Risk of divulging sensitive information.
When you physically sign and handle contracts and other sensitive documents, any sensitive information can be intentionally disclosed. With digital signatures, you have the security-first approach to counter any potential hacking.
Depending on the provider, e-signature security measures may include security certifications, platform security, and physical security to protect the system wherever they reside. These security programs are designed as malware protection, real-time data replication, commercial-grade firewalls, data encryption, signature verification, and compliance with relevant standards such as ISO 27001:2013, CSA Security Trust Assurance and Risk program, and SOC 1 Type 2 and SOC 2 Type 2.
5. Risk of a wrist injury.
One of the most common issues of signing papers is experiencing wrist injury after working on reams of documents in one sitting. In addition, ink, paper, and pens only add to more waste. The best solution is to adopt and accept electronic signatures for your contracting process.
Using e-signatures helps cut down on waste while protecting yourself against wrist injury. Many businesses are now adopting digital signatures to eliminate manual processes when managing their contracts and other documents. For example, companies are using electronically signed agreements with clients.
E-signatures are practical because you don’t have to physically sign agreements every time you accept a new contract or download an online app. Customers will look for another service if you keep on asking them to sign your terms and conditions every time they download your app.
Best Practices to Mitigate the Issues in Adopting E-signing
E-signatures are safer and more secure than wet signatures for many reasons. They are less likely to be tampered with, forged, copied, and misused. Digital signatures have multiple layers of authentication and security levels as well as court-admissible proof of transactions for future reference.
Below are the best practices you can implement while using electronic signatures in your business processes:
- Use a cloud-based e-signature platform to authenticate your contracting process and a signer authorization platform to create another layer of protection from potential hacking and other cybersecurity attacks.
- Build an internal e-signatory procedure or create a formal policy to ensure safety when using digital signatures. You may also consider adding an anti-fraud control with certain compliance measures to protect sensitive information.
- Approve additional signers, if necessary.
- Update signer list regularly to keep it easily accessible.
- Verify with a legal adviser if using electronic signatures applies to such transactions.
With a well-designed e-signing platform, you can take advantage of the benefits of digital signature technology. Fundamentally, it helps prevent legal risks while reducing other potential threats to your documents as they are being processed. It’s more reliable and legally binding than physical signing.
Employees who are responsible for legal, IT, compliance, risk, and operations management should understand the importance of verification and authentication of signatories and their identity. Moreover, it’s also important to preserve the integrity of signed papers with electronic signatures.
Digital signatures are useful when you know how to take advantage of them. They are more environmentally friendly and a great time saver compared to wet-ink signatures.
Nevertheless, if you don’t manage it correctly, there are risks of not using digital signatures that can be potentially disadvantageous for your business processes and may lead to fraud, identity theft, and forgery.
A reliable e-signatory management platform can help provide you with a secure signatory process with real-time results that are accessible from remote locations.
This is the next big thing in the business world, and it’s a smart decision to understand its features and benefits. Want to find out more about digital signatures? Get updated here on our website.