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What is the Electronic Signature?

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What is the Electronic Signature

For several years, and even more because of the coronavirus crisis, the dematerialization of legal processes has been one of the major challenges of the digital transformation of a large number of sectors and professions. And this goes through the electronic signature in particular.

The booming global market today weighs $ 1.7 billion and will grow by 25% in 2020, according to Forrester. Dominated by DocuSign and Adobe, the electronic signature market is indeed showing a striking shape, reinforced by the needs arising from the coronavirus crisis.

And for good reason, with employees and customers confined to their homes, the electronic signature has emerged as the best solution to ensure the signing of contracts and other documents essential to the proper functioning of businesses. Along with video conferencing, the electronic signature is thus one of the big winners of the current period.

However, many legitimate questions can sometimes slow down the efforts of companies to fully embrace this innovation:

  • The electronic signature: instructions for use
  • Does the electronic signature have the same value as the handwritten signature?
  • Is electronic signature really useful?
  • What are the advantages of the electronic signature?
  • What are the main electronic signature solutions?

These are all questions that we will answer in this article.

The electronic signature: instructions for use

An electronic signature is a digital marking indicating acceptance of a contract or document. For example, when you sign your name on the mobile device of an email, it is an electronic signature. To guarantee the security of the signing operation, it must be able to ensure both the integrity of the signed document as well as the real identity of the signatory. It is by means of a so-called “hashing” cryptographic function that the electronic signature is able to ensure this security.

The electronic signature is governed by the European regulation eIDAS (Electronic Identification And Trust Services). The latter aims to provide a framework for electronic identification and trust services for electronic transactions within the Member States of the European Union. The European eIDAS regulation has made it possible to define three levels of electronic signatures: simple, advanced, and qualified. Logically, the last two levels are the most recommended for companies, as they can be used for documents of high value and high risk. In this context, an electronic certification service provider represents a trusted third party.

Does the electronic signature have the same value as the handwritten signature?

In addition, the three types of signatures (simple, advanced, and qualified) are perfectly reliable in court, because they guarantee the identity of the signatories of a document while respecting the European Data Protection Regulation (GDPR). Therefore, a qualified signature has the same legal value as a handwritten signature. What convinces companies who fear that the electronic signature has only a limited value likely to complicate their activity.

Thus, if the question of the legal value of the electronic signature has long weighed on the decision to opt for this solution, this subject now being resolved, there is no longer any doubt today that it is becoming the norm for many professions (legal, regulatory and financial of course, but also commerce and customer relations), as well as sectors of activity (real estate, investment, banking, trading, etc.).

The electronic signature: to do what?

Format, print a document, sign it, scan it on your computer and (usually) format it again before sending it. To simplify, or even avoid all these tedious and risky manipulations, the electronic signature is now required as the solution that allows these tasks to be carried out easily and in a few seconds. It can be particularly useful for employment contracts, invoices, mandates and sales agreements, accounting documents, legal documents, quotes or even notarial acts.

Companies around the world are not mistaken, having quickly measured the many advantages of these solutions, they switch the vast majority of their contracts or administrative formalities to electronic signature solutions. Whether for quotes, purchase orders, employment contracts, sales agreements, engagement letters, reports of general meetings, SEPA mandates, etc. The list of fields of application for signature electronics is long and the number of contracts is not about to dry up, on the contrary. So, how to choose your electronic signature solution according to your needs and uses, follow the guide …

Docusign - Digital Signature

What are the advantages of the electronic signature?

Coronavirus crisis or not, the electronic signature saves a lot of time. Indeed, with this innovation, it is no longer necessary to wait for an important mail to arrive at its destination, before going back to the company’s offices. Rather than waiting several days for the return of a signed contract, the electronic signature allows the matter to be settled in a few minutes. On a smartphone, tablet or computer, the procedure is simplified as much as possible. This speed does not prevent the electronic signature from being a secure solution, within particular double authentication systems via the sending of confirmation SMS to the signatory’s smartphone, in order to guarantee the identity of the latter.

Beyond simplifying and securing the signing of documents essential to the proper functioning of companies, which is more in the current period when teleworking is becoming the norm, the electronic signature makes it possible to ensure the traceability of documents. Indeed, it is accompanied by a digital certificate which allows knowing in the smallest detail the modifications carried out on the signed documents. Thus, the author of any modification can be easily found with this process. The latter is also widely used in real estate, one of the most active sectors in terms of the adoption of electronic signatures since the Elan law of 2018 (law for the development of housing, development and digital).

Finally, the electronic signature is a good way to reduce the operating costs of a business. And for good reason, it does not require the purchase of paper, ink or pens to sign documents. It also eliminates the cost of printing documents to be signed, shipping costs and travel costs. In short, the electronic signature allows for significant savings. A godsend in the current context forces companies to tighten their belts.

Who are the main players in electronic signatures?

The market is now dominated by DocuSign and Adobe, but French players are also trying to position themselves in this increasingly lucrative sector.

Yousign

Founded in 2013 by Luc Pallavidino and Antoine Louiset, Yousign develops solutions that allow you to sign all official documents online, including contracts, quotes and confidentiality agreements. Among its customers, the French company notably includes Cisco, Allianz, Century 21, and Konbini. After completing a round of funding of 3 million euros in January 2018, the Caen-based start-up joined forces last year with the Franco-Belgian studio start-up eFounders, launched by  Thibaud Elzière and  Quentin Nickmans for build in 18 months the future champions of French and European Tech, in order to begin its international deployment.

Universign

Founded in 2011 by Julien Stern, Universign is another benchmark French player in the electronic signature market. Based in Paris, the company has more than 60,000 corporate clients, such as Total, SFR, Axa, Natixis, Leboncoin and Younited Credit. To expand into Europe, the French start-up notably raised 12 million euros two years ago.

DocuSign

Founded in 2003 by Thomas Gonser, Docusign is the world leader in electronic signatures with more than 500,000 customers around the world, including Apple, Facebook, Uber, Visa, Samsung, Deloitte and Santander. The industry juggernaut has raised a total of $ 536 million as part of its development. Based in San Francisco, the American company made its debut on Wall Street in 2018. The company is now valued at nearly $ 37 billion on the Nasdaq.

Adobe sign

Founded in 2005 by Jason Lemkin and Jeff Zwelling, the American start-up EchoSign raised 8.5 million dollars between 2005 and 2007, before catching the eye of Adobe, the American giant of creation and management software. data, which eventually bought the company in 2011. Adobe then transformed EchoSign into Adobe Sign to make it one of the mastodons of electronic signatures.

HelloSign

Founded in 2011 by Joseph Walla and Neal O’Mara, HelloSign allows its users to sign digital documents. While this is the company’s most popular feature, it isn’t the only one. The San Francisco-based company also offers tools for virtually faxing documents, managing document workflows, and turning PDF forms into easy-to-edit digital files. Supported by the American accelerator Y Combinator, GV (formerly Google Ventures) and Greylock Partners, the company completed a funding round of $ 16 million in June 2017. Subsequently, the start-up was bought by Dropbox in 2019 for $ 230 million. At the time of its acquisition, HelloSign had approximately 80,000 customers, including Lyft, Samsung, Twitter and Instacart. Of these, 55,000 used paid subscription services.

 

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