Digital transformation has been hot on the agenda of business decision makers for several years now, with an estimated $2 trillion being spent on digital transformation in 2019 alone. However, e-signatures are still not widely used within business processes, despite offering numerous benefits including increased productivity, cost and time savings, and an enhanced overall customer experience. Uncertainty around the legality of e-signatures is often cited as an obstacle to mass adoption, but as of the Law Commission’s ruling in 2018, they now carry equal weight to handwritten signatures, giving the technology a much-needed boost in the right direction.
Furthermore, the unpredictable impact of the coronavirus pandemic has ignited action from businesses to digitize their process in order to maintain their business continuity.
Here, we look at the top reasons why e-signatures should be an essential component of any digital transformation strategy:
Enhanced customer experience
One of the key benefits of e-signatures is that they provide a better overall experience compared to their paper alternative. Customers are increasingly expecting digital services from businesses they interact with, regardless of where they are in the world, and this extends to document signing. No one wants to spend time printing, signing, and posting paper documents when they have the option of signing electronically at their own convenience.
This trend has been accelerated by the Covid-19 pandemic, which has led to stay-at-home directives, and customers less willing to handle paper documents that may be carrying bacteria. As a result, it has never been more important for companies to have remote signing options in place that allow customers to sign a document from anywhere, anytime and on any device. E-signature technology is saving businesses by allowing them to continue to do business throughout this crisis.
Not only will this improve the relationship with existing customers, it will also help businesses stay ahead of competitors and attract new ones, leading to increased revenue and a healthier bottom line.
More secure than paper
Security has traditionally been a major barrier to the adoption of electronic signatures, with businesses across all industries worried about breach of confidentiality or an increased risk of fraud. However, as identity and authentication becomes a growing priority, e-signatures actually represent a safer and more secure alternative to traditional paper documents.
For starters, it is harder to track paper documents and they’re more likely to get lost, which risks confidential material falling into the wrong hands. In addition, traditional wet signatures are easier to forge, presenting a greater fraud risk.
In contrast, e-signing platforms incorporate a range of features designed to minimize the risk of fraud and capture a comprehensive audit trail, such as GPS coordinates and timestamps. This means you can see who exactly who signed, where they are located, and the specific time they signed. Once signed, e-signature documents can be protected with digital encryption technology to prevent tampering and can be automatically archived to a content management system using business workflow rules so the document can always be accessed.
If that isn’t enough, there are additional ways of optimizing e-signature technology to validate the signer’s identity and reduce the risk of fraud. These include using biometric authentication, ID document capture, or webcam and video links for documents that require witnessed signatures.
Thanks to the detailed audit trail, any information can be reviewed to identify any suspicious or fraudulent activity, keeping the customer and business much more secure than if they used paper documents.
One of the cornerstones of compliance with the General Data Protection Regulation (GDPR) is having appropriate measures in place to capture, record and manage customer consent. With fines of up to €20 million or 4 percent of annual revenue (whichever is larger), the consequences of not being compliant are severe. E-signatures can be used to conveniently capture consent from any device, comply with the active opt-in requirement, and demonstrate precise details of the consent. Behind the scenes, they can also capture a comprehensive audit trail which records exactly what the signer consented to, when and how they signed. This is invaluable for GDPR, as it means businesses can demonstrate compliance after the fact, providing direct visibility which will resonate well with legal and compliance teams.
Furthermore, the right e-signature solution can also ensure a business is compliant with the eIDAS regulations that came into force in 2016, designed to enable the widespread use of electronic identification across Europe. Businesses should look for solutions that meet the Advanced Electronic Signatures and/or the Qualified Electronic Signature requirements to ensure compliance and security without compromising on customer experience.
Reduces operational costs
By eliminating the need for documents to be signed, transported, and filed in paper format, e-signatures can eliminate costs associated with manually handling paper documents. These include saving money on paper, postage, mailing supplies, toner, as well as time spent by admin staff processing paperwork. OneMain, a US-based financial services company, has eliminated $500,000 in annual toner costs and no longer generates thousand-foot stack of loan papers a month, since implementing e-signatures. Similarly, it is estimated that the Bank of Montreal (BMO) will potentially save close to $100 million dollars in paper costs annually.
Improves employee productivity
As well as saving money, e-signatures can also save employees time that would otherwise be spent processing documents, correcting errors and having to redraft documents. By moving to e-signatures, employees can spend more time doing more valuable work for the business, such as building customer relationships. Wright-Patt Credit Union employees used to spend 22 minutes preparing paperwork, but since they’ve digitized their lending process using e-signatures this has been cut by 50 percent. Similarly, since the national rollout of e-signatures across BMO’s Canadian retail branches, error rates have dropped significantly, with scanning errors decreasing by 92 percent and missing files falling by 66 percent.
While the pandemic has driven adoption for e-signatures because it is helping thousands maintain operational continuity, once businesses experience these benefits to their everyday operations it’s extremely unlikely that they’ll ever want to go back. E-signature technology will likely become a cornerstone in modern business operations.
Dilani Silva, product marketing manager, OneSpan