Risks and Rewards of Using Digital Signatures in Your Small Business


The ESIGN Act of 2000 was signed into law by President Clinton making electronic signatures legal and ushering American businesses into a new age in the world of business. Today, small and large businesses alike are making the move to a paperless way of doing things. This new way of accepting signatures is becoming more widely accepted around the world and is part of a sweeping push to make workplaces around the world greener. But, it’s important to be aware of the potential risks and rewards these changes are leaving businesses open to.


Rewards of Using Digital Signatures

Almost any changes in life come with a long list of pros and cons,and business changes are no different. It’s important to consider the benefits or rewards of using digital signatures carefully before deciding to include them in your business model. These are just a few of the benefits your business might enjoy.

  • Helps businesses adopt greener policies in regards to paper.

  • It serves to authenticate messages as coming from a specific source or user.

  • Ensures the integrity of the document since the electronic signature becomes invalid if the document is altered after it’s been signed.

  • E-signatures allow business owners to enhance the overall customer service experience for their customers.

  • They are simple to integrate into most online business structures.

  • Can be integrated to suit a wide range of business needs.

  • Are extremely convenient and beneficial for customers on the go who are using tablet devices and smart phones to handle their business needs.


Risks of Using Digital Signatures

It would be remiss not to mention some of the potential pitfalls that using digital signatures represents to businesses as well. These aren’t meant to discourage the use of e-signatures. They are the wave of the future for business. There’s really no way for businesses looking to the future to avoid them. It is however, an attempt to raise awareness about some of the mistakes that can be made along the way so that you can take proactive steps to avoid them.


  • Email agreements may prove binding – that’s why it’s so important for companies to have very strict policies regarding email communications. Many companies offer disclaimers at the bottom of every single email communication stating that they are not agreeing to be contractually bound through the email communication.

  • Fears exist that digital signatures are primed to become the identity theft of choice for the future. The UK is already taking steps to protect the identities of e-signature users by providing the software needed to establish a safe digital identity at any of the Royal Mail post offices that can be found throughout the UK.

  • E-signatures do leave businesses more vulnerable to fraud. However, taking proactive steps to render your business more secure will mitigate these risks.


Ultimately, there’s little businesses can do to turn the tide that’s forever changed the way the business world operates. There are things, such as purchasing cyber liability insurance to limit your risks from using digital signatures, that can help you find a little bit of peace in the process.

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