What are the major differences between handwritten signature and digital signature?

Sometimes we feel like we are on top of the continuously evolving technology, then something else pops up. From the developed to the developing world, automation is bringing in a new wave of change.

Did you know that there is a difference between Digital and Electronic signatures?

It is very common to see the terms digital signature and electronic signature used as synonyms. Many people believe that their meanings are identical. However, these solutions are not interchangeable.

For many years, companies have been using a large number of electronic communication solutions to certify digital identities or protect communications on a network. Within this market, the electronic signature and digital signature have led the way in this business transformation. Digital transformations of business are faced with rising concerns over Authentication, Validation, Trust, Recognition, Security and Reliability of digital transactions.

The world of business is transforming at a fast pace, and there is no scope for any organisation to fall behind. We have all witnessed several technological advancements, making a huge difference to businesses all over the world, such as customer relationship management systems, social media marketing, and integrated communications.

Since time immemorial, personal signatures have been playing an important role in human identity for many years now. They are used every day by almost everyone to sign essential documents.

Signatures were not a thing of significance before the State of Frauds act was passed in 1677 in the English parliament and it was this that made signatures an everyday marker.

Printing documents, signing them physically, scanning, and sending them back have become a thing of the past. Wet signatures had become the standard in offices all across the globe. However, these days, this practice like everything else, moved on to a digital form. 

It is therefore necessary to clarify these concepts due to the confusion from users who, despite being more and more knowledgeable about technology, often think that an electronic signature and a digital one are the same.

Initially, electronic signatures were a luxury business expense, but today they are used widely all across the globe. Digital signatures that are a part of electronic signatures have not received much attention. This may be because very few people are aware that both these terms are different. Most people think that digital signatures and electronic signatures mean the same thing and so use these terms interchangeably. However, both words hold different meanings. 

In today’s hyper-connected world, traditional methods of signing and authenticating documents are increasingly being replaced by electronic signatures, sometimes referred to as digital signatures.

Many people think that electronic signatures are the same as digital signatures but that is not the case. In fact, digital signatures are a highly secured way to implement electronic signatures.

A Digital signature is a kind of Electronic signature, but are distinct. A Digital Signature is more secure and tamper-evident, which encrypts the document and permanently embeds the information in it if a user tries to commit any changes in the document then the digital signature will be invalidated. On the other hand, an Electronic Signature is similar to a digitalized handwritten signature verified with the signer’s identity such as email, corporate ID’s, phone PIN etc.

At its core, an electronic signature doesn’t necessarily have to be a signature. It can include a sound, symbol, or process that’s attached to a contract. They encompass all online signatures and are more broad of a definition than digital signatures.  

Conventionally, signatures with a message were used to signify the identity and intention with regard to that particular message and its main purpose is to prove the ownership. For many years, people have been using several types of signatures to associate their identity and intention to the messages. For example, handwritten signatures, seal, wax imprint, etc. These traditional approaches can be easily forged. Digitalization has given rise to the need of signing a digital document using digital techniques.

What is a Digital Signature?

A digital signature is a specific technical implementation of some electronic signatures by applying cryptographic algorithms. It therefore refers to the coded/decoded technology in which some electronic signatures, such as the advanced one, are based.

The digital signature is a set of characters that are added at the end of a document or the body of a message to certify or show validity and security. They are therefore used to identify the person issuing said message and to certify the veracity that the document has not been modified with respect to the original.

It is an electronic signature form used for authentication of the identity of the communicator or an authority signing the document. It ensures authenticity and originality of the content of the communication or the document. Digital Signatures remain unchanged throughout the communication or documentation, they are easily transportable and cannot be imitated by anyone else. A Digital Signature also makes sure that the sender cannot deny the content sent via that signed document.

The digital signature represents the process of encoding a document with encryption and other security methods to prevent tampering. It’s done through a calculated computer process called an algorithm. Adding a digital signature prevents anyone other than the authorised recipient from viewing a document. Digital signatures designate an authorised signee for a specific document, acting as sort of a “fingerprint” for a transaction, guaranteeing the authenticity of the person signing a document.

A digital signature is like a lock on a document. It requires the existence of an official certificate issued by a body or institution that validates the signature and the identity of the person performing it.

How Does a Digital Signature Work?

Digital signatures work by proving that a digital message or document was not modified intentionally or unintentionally from the time it was signed. Digital signatures do this by generating a unique hash of the message or document and encrypting it using the sender's private key

Digital signatures use a public and private key generation framework, signature algorithm and a verification algorithm to match public and private keys and validate the authenticity of electronic signatures.

Companies that provide digital signature solutions typically comply with a set of requirements called the Public Key Infrastructure (PKI). It outlines the criteria on how businesses should implement electronic signature technology.

Digital signatures use a standard, accepted format, called Public Key Infrastructure(PKI), to provide the highest levels of security and universal acceptance. They are a specific signature technology implementation of electronic signature (eSignature).

A provider’s algorithm must produce two sets of long numbers called a private key and a public key. The private key encrypts the document and ensures no one else can view the contacts. The public key confirms a match to a private key before decrypting a document.

How Digital Signatures work:

Digital signatures like handwritten signatures, are unique to each signer. Digital signature solution providers, as mentioned earlier, follow a specific protocol, called PKI. PKI requires the provider to use a mathematical algorithm to generate two long numbers, called keys. One key is public, and the other key is private.

When a signer electronically signs a document, the signature is created using the signer’s private key, which is always securely kept by the signer. The mathematical algorithm acts like a cipher, creating data matching the signed document, called a hash, and encrypting that data. The resulting encrypted data is the digital signature. The signature is also marked with the time that the document was signed. If the document changes after signing, the digital signature is invalidated.

To give an example, John signs an agreement to sell smart cards to a Telecom company using his private key. The buyer(Telecom company) receives the document. The buyer(Telecom company) who receives the document also receives a copy of John’s public key. If the public key cannot decrypt the signature (via the cipher from which the keys were created), it means the signature is not John’s, or has been changed since it was signed. The signature is then considered invalid.

If everything matches then the signature is considered a valid, legally binding signature. If, on the other hand, something doesn't match or the document was tampered with, the signature becomes invalidated. Attached to that signature is the data that is required to prove your intent to sign and your identity so that if there is ever a legal question about your signature on the document, it can be proven in court that your signature is binding.

To protect the integrity of the signature, PKI requires that the keys be created, conducted, and saved in a secure manner, and often requires the services of a reliable Certificate Authority(CA). All Digital signature providers, meet PKI requirements for safe digital signing.

Certificate authorities bind the user’s identity to a PKI-based digital certificate which allows the user to apply digital signatures to the document and the cloud-based signing platforms. When a digital signature is employed to a document, a cryptographic operation attaches a digital certificate with the data into one unique fingerprint.

The message is signed by the private key of the sender which is only known to him/her; this ensures authentication of the message source. The message and its signature cannot be changed. The Sender and receiver do not have to worry about transit alteration without the private key, the message and its signature can never be altered. The sender of the message cannot refuse having signed a signature if it is valid. A Digital signature distinctively correlates with the corresponding message and renders integrity.

Digital documents have become a go-to for many companies looking to streamline costs associated with managing paper documents.

Understanding the Digital Signature Certificate

A Digital signature certificate can be better understood as the electronic alternative to physical or paper certificates such as a driving license, passport, etc. Digital Certificates are proof of the identity of a person having a specified purpose. For example, a passport identifies a citizen’s identity with relation to a nationality and that the citizen is eligible to legally travel to any country on a grant of permission. Under these identity requirements, the digital certificate is used to electronically prove a citizen’s identity and helps the access to information or services via the internet or other electronic mediums or to sign documents digitally.

Is there a Need for a Digital Signature Certificate?

A digital signature certificate is a convenient way to authenticate an identity electronically with a high level of security for online transactions while safeguarding one’s privacy of information shared via a Digital Signature Certificate. These certificates are used to encrypt data in a way that only the desired recipient can have access to it. The digitally signed information also ensures that it remains unchanged throughout the process of digital transfer as well as verifying the identity of the sender of the message.

Digital signatures have replaced the old ways of signing reports and documents. In the past, pen and paper was used for signing anything, but now digital signatures have taken over.

Digital signatures ensure that the message contents are not changed or altered and helps to reduce the problems of tampering.

They also supply details such as the consent by the signer, the origin, and the status of the message.

Digital signature scheme steps:

• Key generation: The public key and its correlated private key of the user is computed in this step.
• Signing: The corresponding message is signed by the user with his/her private key.
• Verification: In this step, the signature for a provided message against the public key is verified.

Components involved in creating and securing digital signatures:

• Hash Function: The hash represents a set of numbers and letters generated from an algorithm used by electronic signature software that is unique to a document. Hash functions are useful because they are built to be one-way, meaning they cannot be reversed to find other files using the same values.

• Key cryptology: Represents the cryptographic method used for generating the set of public and private keys associated with a document.
• Public key Infrastructure (PKI) — PKI represents the standards, policies, people, and systems that offer support for distributing public keys and validating the identities of individuals or entities using a certificate authority and digital certificates.
• Certificate Authority (CA) — A trusted third-party charged with validating a signee’s identity. They also create the public/private key pair for someone or tie an existing public key from an individual back to themselves. After validating an identity, a CA provides them with a signed digital certificate. That information can then be used to verify the identity of a person tied to a public key.

Applications of Digital Signature

• To send and receive encrypted emails, that are digitally signed and secured
• To carry out secure online transactions
• To identify participants of an online transaction
• To apply for tenders, e-filing with Registrar of Companies, e-filing of income tax returns and other relevant applications
• To sign and validate Word, Excel and PDF document formats

Why would you use a Digital Signature?

Digital signatures represent one of the most critical components of an eSignature platform. They are used to drive the security around and support the legal validity of an electronic signature. Digital signatures enact protection around an electronic signature from the moment it’s signed. Using digital signatures also increases the transparency of online transactions between businesses, customers, and vendors.

Another reason to use digital signatures is that they embed electronic signatures with a watermark that tracks changes. It is also used to verify the completion of an online transaction and seals a file once it has received the required electronic signature.

Integrity is a very vulnerable factor in the digital world, as there are many ways and tools to easily modify an electronic document.

How Do You Create a Digital Signature?

The process of adding a digital signature to documents depends on a user’s choice of software. For example, when you add a signature line to a Word or Excel document, users can embed/select an option from the menu that allows them to add information unique to the recipient.

It works the same way when users work with software from a digital transaction management (DTM) company, who function as a certificate authority for issuing digital certificates. They select an option from the menu to add a digital signature for each recipient of the document. Take note that, Digital signatures are completely different from adding an electronic signature to a record.

Companies can also opt to issue self-signed digital certificates. However, recipients will not have the ability to verify its authenticity. They will be forced to use their judgment on whether to accept the digital certificate and provide an electronic signature. Using a self-signed digital certificate could lead to problems if a contract or other agreement end up challenged in court. It’s the reason most companies choose to use eSignature platforms from DTM companies that allow them to easily embed digital signatures into a document

A digital signature is also legal but it does not have a legal nature per se, in the sense that its objective is NOT to certify an act of will on behalf of the signatory but just to encrypt the data in a document to give it greater security.

What is an Electronic Signature?

An electronic signature is a bit of data that refers to other electronic data, and is used to verify that a person intended to sign a document, that the signer’s identity was verified, and that the document did not change after the signature was appended. So we can say that an electronic signature is a legal concept whose objective is to certify the will of the signatory.

It isis the capture of the process a person goes through when demonstrating intent during an electronic transaction. The term “electronic signature” refers to several different methods of capturing a signature on a paper or device. It can also be typing your name into a signature box using a tablet or mobile app to capture an image of a handwritten signature. For example, delivery slips.

Electronic Signatures use a technology that binds the signature to the signer’s identity and the time it was signed. An electronic signature could be a process attached, electronic symbol or sound to a message, contract or document which can be used to get consent or approval on electronic documents or forms. Electronic signatures are a substitute for handwritten signatures in practically each personal or business process.

There are two essential components of an electronic signature:

(i) Signer’s intent to sign, i.e., the document is captured (ii) Document or record is correct.

It uses general electronic authentication techniques to justify the signer identity, such as email, corporate ID etc. When there is need to enhance security, multi-factor authentication can also be used. The efficient e-signature solutions indicate proof of signing by utilising a secure process of audit trails along with the final document.

Key Differences Between Digital Signature and Electronic Signature

The terms digital signature and electronic signature are often used interchangeably, but they are actually different. There is often a lot of confusion about the difference between electronic and digital signatures. Notably, electronic signatures include all forms of a signature whereas digital signatures are attached to an actual signature. 

The key differences are:

• Digital signature is used to secure a document while an electronic signature is used to verify a document.
• On the basis of document processing platform, a digital signature is of two types – Microsoft and Adobe pdf. On the other hand, an electronic signature is of four types – basic electronic signature, click-to-sign signature, advanced electronic signature, and qualified signature.
• A digital signature is regulated by the certification authority. Some national acts and regulations are applied to the electronic signature to validate it.
• A Digital signature is also authorised by the government or non-government certification provider authority. Electronic signatures are authorised by the specific vendors, document creator or the participating parties.
• The main intention of using a digital signature is to secure the document. The main intention of using an electronic signature is to verify the document.
• A digital signature is comprised of more security features which makes it more secure. An electronic signature is comprised of less security features, so it is less secure to use.
• An Electronic signature is a generic expression and much broader regarding electronic data. A digital signature is a signature with public-key based cryptography.
• A digital signature can be used to get the details of signatory as it is associated with the signature itself. Details of the signatory are not held in an electronic signature but can be held separately to the signature. A timestamp is a mechanism that allows the approval of the integrity of a series of data. That means it demonstrates that this data existed in a specific moment, and has not been altered since then. The timestamp guarantees the integrity of the electronic signature. [Image credit: digistamp]

• A Digital signature generally holds the audit logs and helps to make it easy to track when or if changes are made in the document. It is difficult to apply audit logs with an electronic signature.
• Digital signatures are more reliable as these are more secured and not susceptible to tampering. Electronic signatures are less reliable as these are less secured and may be susceptible to tampering.
• A digital signature uses a highly advanced form of standardization known as Public Key Infrastructure (PKI). The keying mechanism is not advanced in the electronic signature.
• Digital Signatures comply with the standards and enhance security by using cryptographic encryption methods. Electronic signatures do not depend on standards and so are less secure.
• The authentication mechanism used in the electronic signature is not defined and uses signer’s email, phone PIN, etc. In contrast, a digital signature involves certificate-based digital ID authentication methods.
• A Digital signature ensures the security of the digital document whereas electronic signature is used for verifying the digital document.

The Main Differences Between Digital Signature and Electronic Signature

• The main one is that while a digital signature makes reference to a series of cryptographic methods, the concept of the electronic signature is of a fundamentally legal nature, since it confers a regulatory framework to the signature that gives it legal validity.
• The other difference is where they are used. An electronic signature is mainly used to sign the electronic documents where the signatory has got an intention to sign the document with his e-signature. On the other hand, a digital signature is used to secure the documents and it is used by the certification authorities.
• The digital signature prevents identity impersonation and allows authentication and identification in all types of processes, such as administrative, bureaucratic, tax, etc.
• Electronic signatures serve as an acknowledgment that the signee accepts the terms of an agreement through electronic means. That includes typing their name in an email, entering a PIN into an ATM, signing their name electronically on a touch screen device, or selecting a checkbox to sign up for a new streaming subscription.
• Digital signatures are created by platforms, like eSignature software, using a mathematical algorithm generated by a computer. They verify the identity of the person signing the document and validate the authenticity of an electronic signature.
• Digital signatures cannot be tampered with by any person because of the high level of security they offer, while electronic signatures can be tampered with by any person because of their low security. 
• The primary aim of digital signatures is securing a document so that it cannot be messed with by any person without authorisation. On the other hand, the main aim of an electronic signature is verifying a document.
• An electronic signature cannot be verified. A digital signature can be tested.
• A Digital Signature is particularly secures a document. An Electronic signature shows the intent to sign the contract.
• An electronic signature is easy to use but has less authenticity. While a Digital Signature is preferred more than electronic signature due to its high level of authenticity.
• The authentication mechanism for digital signatures is a certificate-based digital ID, while that of electronic signatures can be through phone PIN, email, etc.
• The validation process of digital signatures is performed by trust service providers or trusted certificate authorities. There is no validation process for electronic signatures.

What an electronic signature solution based on digital signature technology really means is this capacity to collect electronic evidence of integrity and identification. The more evidence is captured during the signature process, the greater the possibilities that the signed document is accepted in a court of justice.

HOW BUSINESSES BENEFIT FROM DIGITAL SIGNATURES

Simple and Intuitive

The biggest benefit of a digital signature is its simplicity and ease of use. Once the signer has acquired his/her digital signature, it becomes very easy to apply it to any document and send it across in a secured manner. The recipient signs the document and the process is complete. It is that easy and can be accomplished from the comfort of the office

Convenience

All types of businesses operate in geographically disparate locations. All big and small businesses have to deal with customers, suppliers and partners located in different towns, cities and countries. Digital signature facilitates online authentication, which makes it a very convenient solution instead of a paper-based printed and scanned version that is resource and time consuming.

Quick turnaround

The convenience of digital signatures inherently implies a faster turnaround time. Instead of involving multiple players, who will handle printing, signing, scanning and sending one side of the business transaction and the same set of actions on the other side, a digital signature authentication happens at the click of a button. Naturally, it gives businesses the necessary agility, edge and helps to improve trust with their stakeholders.

High level of security

In today’s IoT(Internet Of Things) era, e-business is the norm and everyone opts to send documents over the electronic media versus traditional paper documents. Digital signatures become essential in such scenarios. Not only do they contain the signature of the sender, but they also contain traceable information on who signed the document, when was it signed and where. These inherent features of the digital signature enforce stronger security than a conventional paper document.

Lowest cost

With the entire paraphernalia of manual printing, signing, and scanning going out of the way, a digital signature is highly cost-effective. Besides, it saves paper! Over a longer period, all this adds up into the business’ incomes.

The terms digital signature and electronic signature are occasionally used interchangeably, but there differences between them. Although, their purposes would overlap, i.e., authenticating a digital document, digital signatures are widely used and more secure than electronic signatures.

However, when comparing the two of them, it can be said that digital signatures are better than electronic signatures.

This is because digital signatures are more secure and they require more verification. They use coded messages to safely and securely link a document with the signer. Specific platforms can be used to generate particular encryption authentications and keys, such as usernames and logins to ensure your documents are more secure. Digital signatures are universally accepted as they provide the highest level of security.

On the other hand, electronic signatures are less secure and can be set up easily. They authenticate the signer and permit him/her to sign a document, but are not as strong as digital signatures. 

Digital signatures are more preferred and used by government and healthcare sectors, due to the high level of security they offer.

The digital signature is therefore a fundamental part of the advanced electronic signature but not the simple electronic signature (PIN entered at a bank’s automatic cash machine or by clicking on an "accept" box).

So an Electronic Signature is mainly used to verify a document. In this case, the source of the paper, files, and the authors are identified.

The Digital Signature is used to secure a document. For this reason, it is not tampered with by people without authorisation.

All digital signatures are electronic but not all electronic signatures are digital

Are electronic signatures legally binding? The answer is yes. The long answer is: Different countries have different laws.

Traditional “wet” signatures have been with us for thousands of years. They came in many different forms, including stamps, marks, signs, and seals. However, traditional signatures are quickly becoming outdated as new technology reshapes our world. New ways of signing are simpler and easier.

A digital signature is cryptographically secure data. It verifies that someone with your private signing key has seen the document and authorised it. It is very secure, but it’s also more complicated.

Digital signatures and electronic signatures are thought to be the same, but they are quite different. Digital signatures are cryptographic “nuts and bolts.” An electronic signature might just be a typed word, ticked box, or recorded voice. A digital signature is technology that uses complex mathematics to encrypt and decrypt data.

In a nutshell, every document requiring a digital signature has, in effect, a unique key attached to it. This is done using a public key infrastructure (PKI). A Public key is generated and tested by the operator of the PKI called a Certificate Authority, and is held by the document owner, who can then pass on copies to his or her clients. Once the client signs, a unique key (private key) message becomes embedded inside the document. If anyone tries to tamper with the document, the software algorithm will detect it and invalidate the document.

Due to increased identity theft in recent years, it has become ever more important for documents to be signed under a watchful eye, whether that be through digital or in-person witnesses. Companies that value your security will enact several layers of protection to ensure that every document is using digital signatures and is legally secure.

Bye bye ballpoint and ink pens – Add digital signatures to documents on the go.

Most businesses today are embracing the idea of paperless offices. To do that, they have identified what a digital signature is and the advantages of using them. They are now using digital signatures to authenticate important documents and make legally binding agreements.

So with the highest security, convenience and lower cost, digital signatures become the right choice for businesses to ensure higher workflow efficiency and customer satisfaction.

Every organisation needs signatures, and every organisation wants to optimise them.

A small change like a signature, can prove powerful and beneficial.

Is your organisation/company ready to cut inefficiencies?

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