Thanks to the advance of technology, long gone are the days when people used to use ink to sign on hard paper. We now have electronic signatures, also known as e-signatures or typed signatures to replace wet signatures. The fact that these signatures get time-stamped, are secure, traceable, and save both time and money has made them a favorite with the business community.
According to statistics, transactions done using electronic signatures have skyrocketed to $754 million within the last five years from $89 million.
Even though typed signatures have helped in speeding up and improving businesses for about 20 years now, not many people understand them. This article will provide insights into the meaning of typed signatures and whether or not they are legal.
What are Typed Signatures?
To a layman, the only difference between typed signatures and those involving signing on paper using a pen is that for the former you write your name on the document through an electronic device. They also get referred to as electronic signatures.
But going with the legal definition, a typed signature means an electronic process, symbol, or sound that gets associated or attached logically to a record of a contract. Based on the meaning from the law dictionary, it’s a way to sign a document electronically and agree without using papers.
But not any typed signature qualifies as legal. It must meet some qualifications to be considered legal, meaning that it proves the legitimacy of your contract. Like many people, you may be asking yourself: are typed signatures are legally binding? Fortunately, they are, but the law governing their legality differs between countries.
The Legality of Typed Signatures
According to the USA’s Electronic Signature and Records Association Act, an electronic signature becomes fully legal only when all parties are in agreement to use them. Additionally, based on the Uniform Electronic Transactions Act, every state should have an outline of how the e-signatures should be used. The e-sign act permits the use of electronic records. Now, you can sign a contract electronically.
This also applies to the European Union.
But though there exists legislation in various states and countries, it’s wise to do detailed research online and investigate further. Alternatively, you can seek services of legal counsels for specifics and clarifications. In the US, typed signatures are used to create law. You can present an e-signature in court as evidence as well.
In the UK, typed signatures were accepted under the country’s Act by the Electronic Signatures Regulations in the year 2002. According to this Act, it’s not a must for a contract to consist of a written signature. For an agreement to be valid, all it takes is for all parties to agree mutually and understand the contract thoroughly. Hence a typed signature constitutes as proof that all parties involved have agreed to the terms.
In the EU, typed signatures became accepted as legally binding through a community framework directive for electronic signature. According to this directive, an electronic signature cannot get rejected by a mere fact that it was electronically created.
How to Make Your Typed Signatures Legally Valid
Using a typed signature in your business is legal and accepted. But for an esignature that is legally binding and valid, you must adhere to the following rules:
- Prove that the signer wanted to sign by providing options like “Cancel.”
- Prove that the signer wanted to carry out their business electronically. Ensure you get consent from the signer before signing that they accept to use a typed signature in your business transactions or contract. The best way is also to give the option of signing on paper and allowing the signer to choose.
- Give a definite attribute of the signer’s typed signature. Record an email trail, mobile phone number, timestamp, and IP address. An identification system such as two-step identification for signers may be used. The signer might see it as an extra step, but it helps in improving your signer’s standard of attribution.
- Ensure you connect or associate the signature with the signed document.
If you meet all the above requirements, all your typed signatures get termed as legally binding. But there are incidences when typed signatures do not count. Are you wondering why? Consider the following.
When are Typed Signatures Perceived Inappropriate?
In cases of significant ceremonies and documents like certificates of death or birth, divorce, and adoption, typed signatures aren’t considered. A notary or multiple witnesses get required. Typed signatures also get rejected if the signers aren’t computer literate.
Understanding Typed Signatures
It’s no doubt that typed signatures have improved businesses and helped in speeding business transactions. For your e-signature to get recognized as legally binding, you need to meet the conditions explained above. But for some particular documents and occasions, typed signatures do not count.