All you need to know about Electronic Signatures...

We are all familiar with the purpose of a signature however with the constant development of technology observed over the past few years - things have dramatically advanced. 

We have experienced a shift away from hard copy and physical documents sent with 'snail mail', toward electronic documents shared via email, cloud-based software and online sharing services.
But the ease of electronic document usage presented us with a unique problem - how do we get the recipient to sign it? 

Don't fear however, as you may or may not be aware, there is now the ability to use electronic and digital signatures to avoid any issues and keep the document in soft copy form.

In fact, the E-Signature sector is booming - now on track to be worth an excess of $5 billion by the decades end according to DocuSign CMO Dustin Grosse (1)

Despite its growing popularity and use - the concept can be confusing and complex to understand so here is what you need to know.

What is the difference between Electronic and Digital Signatures?

Electronic signatures (also called E-Signatures) is a broad blanket term used to describe all the different ways of signing a document using technology. Digital Signatures are one specific, highly used form of E-Signatures which works by using encrypted mathematical formula to encode a signature that is authentic and guarantees the contents have not been altered in transit to the receiver (2). 

Whilst both forms of signatures allow for materials to be authenticated and signed. The benefit of digital signatures specifically, is the use of a more technical encoding system which improves security and fraud detection when compared to that of electronic signatures. 

If the material arrives but the digital signature does not match the public key in the digital certificate, then the client knows that the message has been altered. 

When can I use an Electronic Signature in Australia?

Electronic signatures including the digital form - are recognised as legally binding and equivocal to a traditional hand-written signatures as long as they meet the standards laid out by the Electronic Transactions Act (3). There are some conditions which may affect the validity of the E-Signature and issues can arise when evidence is required to confirm the exact identity of the signature's author. This risk can be mitigated by the use of digital public key cryptography (4) and other authenticated Digital Signatures methods.

It is likely that this sector will continue to rapidly develop in the coming years with constant advancements in encryption and digital security constantly improving - who knows, hand written signatures may become a thing of the past!

1. Null, C. 2013, E-Signatures: The complete guide to paperless signing, PC World
2. Odoo Express, Digital Signature,
3. Ryan, S. 2019, Electronic & Digital Signatures, Nicholson & Ryan Lawyers, Fee Synergy Newsletter Autumn 2019
4. Delaney, H., Francis, B. Electronic signatures and their legal validity in Australia, Find Law Australia,
Many thanks to Fee Synergy and Shannon Ryan for their coverage of this topic used to write this article.