What Is An Electronic Signature + Example (And What It’s Not)

What Is An Electronic Signature

The electronic signature is on the rise as we move more of our lives online. Allied Market Research reports that the global electronic signature market was worth US$517 million in 2015 and will rise to US$3.4 billion by 2022. Another study by Markets And Markets predicts that the European market will experience the highest growth because “the awareness related to digital signature is being widely addressed in Europe and is further emphasized by strong government regulations”.

There is no doubt that the need for social distancing caused by the coronavirus pandemic is accelerating this trend. Experts say that “with the expansion of e-signature use in the current climate, such practices will likely continue to be used once life gets back to normal and offices reopen”.

With business consultancy Forrester finding that companies saved up to 22,000 hours annually by adopting electronic signature technology and Forbes reporting that businesses can achieve efficiency savings of between 70 and 80% compared with relying exclusively on physical signatures, it is time to see how electronic signatures can work for you.

This article will explain what an electronic signature is, what it isn’t and what you need to know before you utilise this technology for your organisation. Plus, you will find an example of an e-signature to give you an insight into how it works in day-to-day business life.

Benefits of Using Electronic Signatures

There are numerous benefits of using electronic signatures over handwritten signatures. Here are some of the reasons to choose an e-signature system for your business:

Simple and convenient to use

It is easy to send signature requests through your document system or CRM. Then clients can simply sign using a PC, tablet or smartphone quickly and without fuss. There is no need for them to download software. They just open the document and click to sign.

Time saving

You can get documents signed within minutes, even if your clients are on the other side of the world. You don’t have to waste time waiting for physical documents to travel back and forth through the mail. There are no multiple faxes or email scans to print, sign, rescan and send. It all takes place online in a clean and effective process. This helps you increase productivity in your workplace.


Each signature raises a transaction receipt to provide an audit trail for your processes. You can prove the electronic authentication of every transaction that you enter into.


Because every signatory must undergo electronic identification, you can be sure that each transaction is completely genuine. You know who signed the document, when they signed it and where they signed it, which is far more reliable than with a wet signature.


Sending out numerous paper documents can cost a great deal of money. You have the paper and ink costs, printing costs, envelopes, postal charges and the time of the employees charged with seeing through that process and then receiving the replies back. An automated system that requires an electronic signature is far more cost-effective.

Optimised for different legislations

Rules for implementing electronic signatures vary around the world. But you can find a provider such as Signhostthat is flexible enough to adhere to the many different local laws. With the right solution, you can be sure that your signed document is valid wherever you and your clients.

Improve customer experience

A faster and more efficient system does not just benefit your employees, it also makes things run more smoothly for your customers. If the process of reviewing and signing documents is easier and quicker, that can only be a good thing for customer experience. In turn, that reflects well on your business.

Difference between Digital and Electronic Signatures

Although people often use the terms ‘digital signature’ and ‘electronic signature’ interchangeably, they are actually two separate elements. Here is a basic guide to the difference between the two.

Type of signature Properties
Electronic A mark made as a signature on an electronic document in the same way as one would make a signature in pen on a physical form to show confirmation or acceptance of the contents.
Digital A type of electronic signature that provides a unique digital mark which links it to the identification of the person signing. This is used to prove that the signatory is the person they say they are and is backed up by any one of a number of identification methods, including passport selfie check, IP address or Public Key Infrastructure (PKI).

Types of Electronic Signatures

There are three different types of electronic signatures, each of which is used in varying situations, based on the level of security and verification required. Here is a guide to the three different types.

1. Simple Electronic Signature (SES)

Also known as a Basic Electronic Signature, this is any signature used to prove confirmation or acceptance of the document contents. It can manifest in any form, including tapping a button that says “I Agree”, drawing and saving a freehand signature on a computer program, or a wet signature that is scanned and uploaded to your device.

Use this when it is not essential that you verify the identity of the person who signs the document.

2. Advanced Electronic Signature (AES)

This signature provides more security as it enables you to check the identity of the signer. However, it does not require that you guarantee their identity. You should ensure that no one can change the wording or other contents of the document once it has been signed using an AES.

You need to use a Secure Signature Creation Device (SSCD) to be able to accept an AES for a document.

3. Qualified Electronic Signature (QES)

Also known as a non-repudiation electronic signature, this type of electronic signature carries the same weight as a traditional wet signature on a document. It holds special legal status in the EU and, in case of a dispute, it is up to the person who disputes the legality of the signature to prove it is not valid. With an SES or AES, the burden lies with the party that requested the signature.

To issue a QES, the signer must be identified using an acceptable verification method (such as a face-to-face meeting or a remote meeting under some conditions) and multi-factor authentication.

You need to use a Qualified Signature Creation Device (QSCD) to be able to accept a QES for a document.

Is An Electronic Signature Legal?

Electronic signatures are legal in many countries around the world, including all EU member states, the UK and the USA. There are varying rules within each country as to which kinds of documents can and cannot be signed using electronic means.

  • The European Union has the eIDAS Regulation from 2016 which ensures that a digital signature is legal and enforceable.
  • The UK has allowed e-signatures since the Electronic Communications Act 2000, but adopted the eIDAS regulation in 2016, when still a member of the EU. The Law Commission confirmed in 2018 that businesses could legally use e-signatures.
  • The US ESign Act was signed into law in 2000, providing “a general rule of validity for electronic records and signatures for transactions in or affecting interstate or foreign commerce.”

In addition, each country requires different forms of identification and methods of signing electronically. That’s why it’s important to choose an e-signature solution that provides you with the latest methods to help you comply with the local signing and identification methods required in the jurisdiction in which you are working.

The eIDAS Regulation

The eIDAS Regulation came into force in 2016, aimed at improving the process for making electronic transactions across the union. It replaced the eSignature Directive. eIDAS stands for electronic IDentification, Authentication and trust Services and deals with the use of electronic signatures and the means to make them more secure and convenient.

eIDAS allows businesses and citizens in the EU to use their own nation’s electronic identification schemes to perform secure electronic transactions in any other member state. It also provides assurance that electronically signed documents conducted across different nations within the bloc retain the same legal status as a physical document with a wet signature would.

The regulation ranks the different levels of assurance of signatures, using the SES, AES and QES system. eIDAS mandates that QES issued by a Trust Service Provider (TSP) is the most reliable form of e-signing. A QES that meets the specifications stated within the regulation and has the signer’s digital identity embedded is less likely to be challenged than a lower security form of signature.

The rules apply across the EU, but member states can set their own rules on which types of transactions can or cannot be completed with an electronic signature.

How to Get an Electronic Signature

If you require a Simple Electronic Signature, an Advanced Electronic Signature or a Qualified Electronic Signature, read these guides to find out how to get them.

How to Get an SES

There are a number of ways to get a Simple Electronic Signature, but this is the general process:

  1. Freehand draw your signature in Paint or a similar program; scan a copy of your pen-written signature; take a photograph of your signature; type your name and choose your favourite font.
  2. Save the signature as a file on your device.

How to Get an AES

To get an Advanced Electronic Signature, there are some conditions you have to meet.

  1. You must be able to link the signer directly and uniquely to the signature through an SSCD.
  2. The signer has full control of the signature through Public Key Infrastructure (PKI) protocols.
  3. The signature is linked to the document so that it can prevent any further changes being made to it once the recipient signs. You can get an AES from one of the websites that provide such services.

How to Get a QES

To get a Qualified Electronic Signature, you have to fulfil the requirements for an Advanced Electronic Signature, but you also need to take some more steps to achieve the Qualified status.

  1. Use a QSCD to generate a qualified digital certificate.
  2. A Trust Service Provider, qualified by the local government, must manage the creation data in order to keep it confidential, unique and to prevent forgery of the data. In the EU, you can only use TSPs who are featured on the EU Trusted Lists.
  3. You should use the latest signing and identification methods associated with the countries in question. We have provided a list of those accepted in 12 European countries.

How to Sign a Document Online

When you receive a document that you need to sign, despite the highly technical work going on in the background to ensure the unique and confidential nature of the data and PKI, the process is actually very simple. This is how it works with Signhost:

  1. You receive the signing request, which could guide you to a page on the company’s website to see the document. Alternatively, the document could be embedded into an email.
  2. Read through the document and find the section that requires the signature.
  3. The program requests you to identify yourself using one of the accepted verification methods for your region and for the assurance level required of the signature. The company may choose to narrow down the options allowed in your jurisdiction depending on which ones it prioritises. Some options include a passport selfie check, IP address, email, apps such as iDEAL and iDIN, and third-party authentication methods like PKI, DigiD or eHerkenning.
  4. Type your name into the smaller box, then freehand draw your signature into the larger box.
  5. Hit ‘Sign’ and you will receive a message to tell you that you have successfully signed the document.

Electronic Signature Examples

Here are some examples of situations in which electronic signatures can revolutionise your workflows.

Employee Onboarding

Starting a new job can be an overwhelming experience, and that is only compounded when you are faced with mountains of papers to read through and sign. When you think of the forms you need to complete during the onboarding process, there are so many to consider:

  • Employment contract
  • Health and Safety documents
  • Code of Conduct
  • Background check consent
  • Workplace pension documents

Not only is it difficult for the new employee to keep track of the paperwork, but getting the correct forms to the right departments once they are signed is fraught with opportunities to go wrong.

Moving the documentation and signing requirements online ensures each department receives the confirmation it needs. And the employee maintains a tidy desk with a simple on-screen workflow to complete on their first day, along with a digital record of everything they have signed.

Customer Contracts

Customers crave convenience and the traditional methods of asking them to meet you at a certain place at a certain time to sign a contract and seal a sale are very often where the deal breaks down. Similarly, expecting a customer to wait for a document to arrive in the post, have them sign it, then find an envelope big enough, buy a stamp and walk to the postbox is incredibly inconvenient.

Our lives are moving ever more quickly and these processes seem stuck in the dark ages by comparison to how simple it is to buy regular products online.

If you are an estate agent, letting agent, bank, car dealer, mobile phone retailer, travel agency, insurance agency or any other company that requires customers to sign contracts before completion, e-signatures make it much more likely that you will close the deal. The customer can read the document on their smartphone, verify their identity and leave their signature within minutes, wherever they are in the world.

Supply Chain Logistics

Supply chain logistics can be extremely time-sensitive. You need to ensure the products arrive at the correct time, after you have cleared space to store them and right before you need to use them. A delay caused by a contract that was lost in the post or which has sat in a pile of unopened mail on a desk for days can have knock-on effects on the timing of a project. This can cause additional costs and it can all be avoided by using electronic signatures.

With multiple stakeholders involved, being able to send documents to them instantly, track when they sign them and send reminders before the due date can keep the operation running smoothly.

No one has to travel to another site to sign a document in person, they can all complete the task from their desk and get on to completing their portion of the chain.

In addition, the ability to sign and send out documentation more quickly and conveniently can help you be more agile and take advantage of good value rates before they rise. It is also convenient for auditing that all aspects of your involvement with the supply chain are stored in an easy-to-find filing system in the cloud. Rather than having to trawl through massive amounts of paperwork to satisfy the inspectors, you can simply search the necessary documents through your e-signature platform and find them straight away.

Contact-Free Business

Whilst the world is still in the grip of the COVID-19 pandemic, the ability to conduct business without unnecessary contact is invaluable. There is no need to make parties travel across countries or even continents just to sign a document, increasing the risk of them contracting or spreading the virus. Instead, you can complete the business from your own workplaces in a safe and secure manner.

Another benefit is not having to use shared office equipment such as printers, fax machines and scanners which could spread the infection if previously used by someone who carries it.


What is considered an electronic signature?

Very simply, an electronic signature is anything that denotes the user accepts, acknowledges or adopts the contents of a digital document.

What does an electronic signature look like?

It could be a typed symbol, word or name, the action of tapping a button that says ‘I Agree’ or similar, or a scanned, photographed or digitally drawn representation of a wet signature. In some cases it could be a combination of numbers such as the PIN used in banking.

What type of authentication is required for different documents?

The type of authentication required for documents is often down to the individual business, but it can also depend on the law within the country.

The general rule is that the more important the document, the more strict the authentication should be. For example, signing for a parcel on the delivery driver’s terminal is a Simple Electronic Signature that does not require the driver to check or authenticate your identity. However, when closing a €100,000 deal, you would need a Qualified Electronic Signature, allowing you to both check and authenticate the other party’s identity.

You should bear in mind that, with a Simple or Advanced Electronic Signature, it is for the person who requested the signature to prove that the correct individual signed it if they claim they were not responsible in the future. If a signer claims they did not make a Qualified Electronic Signature, it is for them to prove that they didn’t. This shows the protection that a QES offers your business.

Are some signatures more legally binding than others?

Unless you can prove that a signer did indeed make an SES or AES, there is the potential for a contract to be invalidated if they claim they did not agree to the deal. A QES is always valid in court.

Is it secure to use electronic signatures to sign documents?

When you use a QES, you can ensure the security of the electronic signature. The signature is connected solely to the signer using a PKI or similar authentication method. The Trust Service Provider ensures encryption and keeps the information confidential and prevents forgery.

The signer has to verify and authenticate their identity and there is an audit trail to show the steps you took to ensure the person who signed the document was the correct party.

Is an email signature legally binding?

An email signature is practically a Simple Electronic Signature in eIDAS terms. There are no set rules in the regulation that make an email signature legally binding but there is a possibility to take it to court. Every piece of text that uniquely identifies an individual, including an email signature, can be pulled as evidence in a lawsuit. But the person who brings up the claim has the responsibility to prove that the email signature was used by the person who owns the email account.


There are many different types of electronics signature. It can be as simple as a tick box or button on the terms on conditions of a website to the signature that launches a multimillion-Euro project. Knowing which type of electronic signature to use is the key to compliance and keeping your deals secure.

Now that you have seen what an electronic signature is, it is easier to understand how e-signature software like Signhost can help. It keeps up to date with the latest verification requirements in each major territory and allows you to use a range of different identification methods. It works seamlessly when you conduct business across borders and provides a transaction receipt along with an audit trail for each signature. Try Signhost for free right now to see how it will revolutionise your business.

References and Further Reading

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