An electronic signature is a digital version of a traditional signature and can offer different levels of security and verification.
- A basic electronic signature (simple e-signature) can be as minimal as ticking a consent checkbox, typing a name in a form field, or attaching an image of a signature.
- More advanced electronic signatures use certificates and encryption to verify the signer’s identity and, in some cases, ensure the document hasn’t been altered.
- A qualified electronic signature (often called a digital or trusted e-signature in the EU) is legally equivalent to a handwritten signature under EU law due to verification by a trusted certificate authority. In the U.S., electronic signatures are generally legally valid under ESIGN and UETA when certain requirements are met.
What types of electronic signatures exist?
1. Basic electronic signature (click-to-accept)
- Example: checking “I Agree,” clicking a “Confirm” button, typing your name in an email, or inserting an image of a signature in a PDF.
- Typically linked to a user of a specific service (system, e-shop, portal) who provides the consent.
- Confirms that the user has expressed consent.
- Best for: internal acknowledgments (training completion, equipment receipt), lower-risk documents.
2. Advanced electronic signature (AES)
- Example: signing via DocuSign or similar, confirming via SMS code or authenticator app.
- Links the signature to a specific person and ensures the document cannot be altered after signing.
- Best for: employment agreements, business contracts, purchase orders.
3. Qualified electronic signature (QES)
- Digital certificate issued by a qualified trust service provider; meets the highest assurance standards (in the EU under eIDAS).
- What it does: has the same legal effect as a handwritten signature on paper in jurisdictions that recognize QES (e.g., EU).
- Best for: government filings, legally significant agreements, communication with public authorities.
The difference is that a basic signature relies on intent. Advanced and qualified signatures use cryptography to make documents tamper-evident and improve proof and auditability.
Where and how do SMBs most often use electronic signatures?
An electronic signature (e-signature) replaces a handwritten signature on paper in a digital environment. Its purpose is to confirm consent or acceptance of responsibility for an electronic document. Companies use e-signatures to reduce paperwork and speed up processes. Below are common real-world scenarios for US SMBs where e-signatures are most frequently used.
- Internal acknowledgments — employees confirm they reviewed a policy or completed training.
- Workflow: approvals for invoices and employee requests.
- Customer and partner agreements — faster than paper; both parties can sign from anywhere.
- HR: offer letters, employment agreements, addendums, contractor agreements.
- Training acknowledgments and compliance attestations.
- Asset handover forms — receipt of a laptop, phone, car, or office keys.
- External and internal document approvals without printing.
What are the benefits of using electronic signatures for businesses?
- Less paper and admin — no printing or scanning.
- Speed — sign from anywhere, including mobile.
- Security — advanced and qualified signatures make any post-signing change detectable and invalidate the signature if altered.
- Auditability — clear insight into who signed, when, and how.
Summary of Electronic Signatures
An electronic signature is the digital equivalent of a handwritten signature used to show intent to sign.
Differences between types and assurance levels of e-signatures
- Note: e-signatures can provide different levels of identity assurance and document integrity.
- They range from simple “click-to-sign” options to advanced methods that verify the signer’s identity and protect the document from changes.
- Requirements and naming conventions differ between Europe and the United States.
Differences in electronic signatures between the US and Europe
- Europe (EU): eIDAS defines three levels—Simple, Advanced, and Qualified Electronic Signatures. A Qualified Electronic Signature (QES) is the closest legal equivalent to a handwritten signature across EU member states.
- USA: The ESIGN Act and UETA make electronic signatures legally valid when there is clear intent to sign and consent to transact electronically. The law doesn’t define technical levels; instead, businesses rely on platform features and audit trails (e.g., DocuSign, Adobe Acrobat Sign) to meet compliance and risk needs.