The Advantages of Implementing Online Contract Signing
Online contract signing has transformed the way businesses execute agreements, making them far more efficient and secure than before. However, it’s not enough to simply sign contracts online. If you want to optimize the process, it’s important to implement the latest e-signature software.
What is online contract signing?
Businesses increasingly rely on technology to provide goods and services and complete business operations in 2022. Companies often use electronic signatures, also known as e-signatures or digital signatures, to adapt to these advances.
E-signatures are a customized and one-of-a-kind type of identification that enables an individual to undertake electronic commerce in several ways. A legally enforceable contract can now be executed with a debit card, a mouse click, or a digital signature pad.
The pros of e-signatures
Online contract signing enhances commerce by benefitting both parties from the simplicity of use, convenience, variety of platform usage (such as internet, email, or debit cards), and an improved pace of transaction processing.
Here’s a more detailed look at the advantages of electronic signatures:
Digitize business operations to reduce cycle times.
Many corporate operations can be digitized using an e-signature, and signatures can be received regardless of time or location. The processing time of signature procedures is significantly reduced because sending papers by mail or traveling to the customer is no longer necessary.
Working in an ecologically responsible way
The digital signature contributes significantly to environmental protection by conserving resources such as water and forests, reducing your carbon footprint. Additionally, implementing environmentally-friendly practices will boost your image among consumers looking to support green companies.
Save time and money
Electronic signatures reduce the need for paper, printers, and other equipment such as ink or toner. Furthermore, an e-signature eliminates the need to travel to the office or meet with the consumer.
Boost client satisfaction
Customers want things to be convenient, and many increasingly want to sign contracts – such as insurance, power, and mobile phone contracts – from the comfort of home.
Improved organization
Some signature providers provide document storage for signed papers, ensuring that they are never lost. Furthermore, searching for a document in digital format is often easier than searching through a physical file cabinet or a folder of paper contracts.
The cons of signing agreements online
Despite the advantages of e-signatures, there are still a few challenges that administrators should be aware of. As with any new technology that your business implements, many of these issues present themselves when your business first adopts the program.
These challenges include:
Technical skill is required
For those who are less technically skilled, the electronic signature may take some getting accustomed to. Furthermore, they may doubt the legality of the signature and the overall signing process.
The cost of software
If extra software is necessary, it is normally subject to a price. The features associated with free tools are typically just enough for a small business that handles minimal agreements.
The risks and dangers of online contract signing
There are some risks of e-signatures that businesses should consider before implementing them in their regular operations.
These risks and dangers include:
Fraud and reliability
While employing a digital signature platform can alleviate any e-signing authentication difficulties, there is still a substantial risk of signatory forgery and fraud for organizations since technology can be stolen or hijacked.
Unauthorized signatures
The potential of unauthorized signing is a big issue with both wet ink and electronic signatures. How can businesses verify that all of their signatories (including e-signatories) are properly authorized? And conversely, how do signatories know what they are authorized to sign?
Non-compliance concerns
Organizations must follow the rules and regulations for contracts on top of regional and international electronic signature legislation (MiFID, FCA, etc.). Organizations that do not comply risk being sanctioned and penalized by regulatory authorities, losing accreditation status, or harming their brand equity.
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How digital signing software can mitigate e-signature risks
By implementing contract management software, you can avoid many of the dangers and risks associated with e-signatures. The software offers a safe and reliable platform for your business to sign contracts online.
E-signature software offers features such as:
Security precautions
Some of the biggest concerns of online signatures include fraud and data breaches. However, contract management software provides data encryption and user authentication features that ensure your documents are only seen and signed by trusted parties.
Audit trails
Contract management tools now enable organizations to manage signatory lists in real-time while maintaining a comprehensive and unambiguous audit record of all data changes.
Risk assessment
Contract management software grants your team access to a digestible dashboard where you can easily view the risk and compliance levels of your agreements. This helps you ensure that your online signatures align with current laws and regulations.
Best practices for implementing online contract signing software
The electronic signature is a critical component of a business’s digitization. The software’s costs are offset by savings in time, money, and resources. The technical knowledge and accompanying infrastructure that the software requires can pose a challenge. However, you can mitigate these challenges through proper implementation.
The best practices for implementing a digital signing platform include:
- Maintain a current and easily accessible duly signed list.
- Create a formal internal e-signing procedure/policy, and evaluate any additional anti-fraud control and compliance procedures.
- Adopt a program that features cloud-based e-signing to expedite the process.
- When in doubt, speak with a legal professional to determine whether employing e-signatures is suitable for your business.
E-signatures are unquestionably a significant step forward in efficiency that may be further optimized when your business takes advantage of signatory management platforms such as contract management software.