How are E-Signatures changing the ways we sign our John Hancock?

It has been 13 years since President Bill Clinton signed into law the Electronic Signatures in Global and National Commerce Act (ESIGN, appropriately enough), and the irony that he used a pen to do so should be lost on no one. And still, well over a decade later, people are still putting pen to paper when it comes to official documents.

That’s probably because making them secure has been a challenge; you can scan the boss’s signature and drop it into the end of a Word file, but that doesn’t make it an official electronic signature.

A true electronic signature, or “e-signature,” takes the concept to the next level by turning into a unique, coded “fingerprint” of sorts, making it an official and track-able sign-off. It’s encryption technology; what makes it secure is that if the encrypted document is modified or tampered with in any way, the technology will detect it and the document will be invalidated.

Every e-signature is time-stamped and unique, so that each signature is associated only with its assigned document. Each one includes proof of signer identity, the signer’s specific intent and the document’s integrity.

While this doesn’t necessarily spell the end of the over-nighted FedEx box with a contract inside, it does open up a lot of new doors for a variety of applications across many different business models.

One recent example is that the IRS this year began accepting electronically signed 4506-T and 4506-EZ documents for requesting transcripts of tax returns. Banks and other financial institutions are more and more moving transactions to the web, and as a result are utilizing e-signatures.

In fact, American Banker reports there are now 42 companies currently providing electronic signature solutions, a number which is sure to grow this year. And the e-signature industry is growing at such a pace that one provider, DocuSign, predicts it will expand by $5 billion in sales by the end of this decade. Another, EchoSign, claims it is processing 1.5 million documents every month.

An e-signature application on the rise with Sebis customers is utilizing the technology to process insurance applications. Sebis clients who have already centralized their document processes with us have begun to use e-signatures by giving the end users the ability to sign insurance applications online, vastly improving efficiency and convenience as well as reducing operational costs.

Real estate is another industry that increasingly uses electronic signatures. Say you’re selling your house, and a potential buyer makes an offer – but you’re in New York on business. Rather than waiting until you return to respond, you can accept the offer or file a counter-offer digitally.

Throw the recent rise of cloud computing into the mix, and there’s no wonder the use of e-signatures is slowly but surely coming into its own, even if it has taken a few years since ESIGN became law. Forrester predicts that in 10 years, electronic signatures will be the primary form of signatures, driven by a huge surge in consumer technology adoption.

Of course, that growth will be boosted as solution providers find ways to bring the e-signature experience to the end user by making it as simple and straightforward as possible.

When this transformation occurs – and it seems it’s only a matter of time before it will – expect e-signatures to become a standard part of the way we do business. Perhaps one day presidents will use e-signatures to sign bills into law.