Wet signature vs eSignature: What’s the difference?
Sign on the dotted line. It’s a common phrase that’s repeated in countless settings, from high-stakes business deals to everyday restaurant transactions. We all understand that, in most cases, a signature is the key to creating an official, legally binding contract or agreement.
However, as the world becomes increasingly connected, more and more business is being conducted remotely. Instead of face-to-face meetings and paper contracts, we use electronic forms and online delivery methods. As a result, the definition of the term signature has evolved.
Over the past several decades, countries around the world have enacted laws and regulations governing the use of electronic signatures (or eSignatures). In this blog post, we’ll explore the difference between traditional wet signatures and eSignatures, along with common use cases for both.
What is a wet signature?
Wet signature is the catch-all term that’s used to describe a traditional, handwritten signature applied to a physical document using pen and ink. Wet signatures have been used throughout history to verify identity and execute legally binding contracts.
Today, eSignatures carry the same legal weight as wet signatures in most cases. However, in certain situations, traditional handwritten signatures are required to provide an extra layer of protection against fraud or forgery. These include:
- Wills, powers of attorney, and testamentary trusts
- Adoption and divorce agreements
- Court orders and other documents related to court proceedings
- Notice of default, foreclosure, repossession, eviction, or utility termination
- Termination of life or health insurance
- Product recalls and safety notices
- Documents related to the transport or handling of toxic or hazardous materials
What is an eSignature?
eSignature is a fast, efficient way to sign an agreement using a digital action or process. An electronic signature can resemble a traditional wet signature, but that's not necessary. As long as the eSignature is associated with a particular record and the signer intends to use it as their signature, it is considered valid. Common eSignature formats include:
- Signing with your finger on a mobile device
- Typing your name or PIN on a digital form
- Clicking I agree on a website
For more than 20 years, eSignatures have been recognized under US law and are generally granted the same legal weight as handwritten signatures. They are valid and enforceable for most transactions in the United States. Common use cases include:
- Business and personal contracts, including purchase agreements, service agreements, and employment contracts
- Financial documents such as new account forms, loan applications, broker contracts, and signature cards
- Litigation filings, including deposition transcripts, medical releases, and settlements
- Transactions such as closing documents, disclosures, legal filings, and non-disclosure agreements (NDAs)
Electronic signature vs digital signature
While the terms electronic signature and digital signature are often used interchangeably, there are some important distinctions between the two.
In the US, an electronic signature is defined as: an electronic sound, symbol, or process attached to or associated with a contract or other record and adopted by a person with the intent to sign. They carry the same weight as handwritten signatures and are legally enforceable, as long as a few basic requirements are met. These include:
- The parties must show clear intent to sign and consent to electronic signature
- The software used to create the signature must capture the signature process
- Records of the electronic signature must be retained and available
A digital signature is a more secure form of electronic signature. It must be backed by a digital certificate, which provides proof of the signer’s identity. Digital signatures are electronically bound to the signed document and include encryption that prevents tampering with both the signature and the document itself.
While eSignatures are sufficient for most everyday agreements, digital signatures provide an extra layer of security. They’re most often used for sensitive documents and highly regulated industries like government, healthcare, and financial services.
Advantages of wet signatures
The main advantage of a wet signature is that it’s accepted and legally binding for any type of transaction. Wet signatures are easy to understand, and they don’t require any technology or special processes.
That said, capturing signatures the old-fashioned way is slow, inefficient, and needlessly complicated—not to mention risky. Here are some of the main challenges companies face when relying on wet signatures:
- Speed: Collecting wet signatures takes time, if you consider what’s really involved: print your document, sign it, then scan and mail (or email) it to your recipient—and wait for the other parties to do the same. Using physical documents also puts you at the mercy of delivery services, business hours, and holiday schedules.
- Expense: Hard costs like paper, ink, and delivery fees aren’t the only expenses associated with wet signatures. You also need to consider the cost of delays—including potential lost business if your prospect decides to explore other options while they wait.
- Security: Wet signatures are susceptible to forgery, and may require forensic analysis to verify who actually signed the document. And paper documents can be lost or stolen, putting sensitive information at risk.
- Customer experience: Paper documents and manual signature processes increase the chances that customers will run into issues—from running out of printer paper to missing a drop-off deadline.
Advantages of eSignature
eSignature technology is an important tool for any modern business that relies on contracts, agreements, and other signed documents. It can transform the end-to-end signature process by automating document delivery, streamlining approvals, improving security, and more.
Here are a few of the many advantages eSignature can deliver:
- Streamlined processes: Speed up approvals and reduce the time to yes from days to minutes.
- Advanced security: Eliminate the risk of forgery and store sensitive information in a secure electronic record.
- Fewer human errors: Automate the data capture process and create a unique audit trail for every transaction.
- Better customer experience: Deliver a fast, intuitive signing experience without unnecessary complications or delays.
- Improved record keeping: Monitor the status of signature activity; see when customers view and sign each document.
- Seamless integrations: Connect eSignature technology with other tools to capture signatures at any point in your business processes.
How Conga can help
Today’s customers expect business processes to be quick, easy, and seamless—which makes eSignature a must. Adding the right eSignature solution to your business can improve workflows and allow you to capture the signatures you need at any time, on any device, from anywhere.
Conga Sign lets you modernize your signature process, putting time and money back into your organization. With our easy-to-use, secure eSignature solution, you can speed up approvals, save money, and reduce risk—all while creating an easy, efficient experience for your customers and employees.
Sign up for your free trial and start simplifying signature collection with Conga Sign.