Digital signature vs. electronic:
Is there a difference?

There definitely is! Nevertheless, the two terms are often used interchangeably. And to add to the confusion, some languages don’t make a distinction. But understanding the difference is key to asking informed questions about the legal validity of agreements signed electronically, including the integrity of your documents.

It’s easy to confuse the two terms

It’s very easy to confuse digital signature and electronic signature. In this guide, we’ll walk you through the differences between digital and electronic signatures to help clear things up. You’ll learn the key features of each term, examples of what they encompass and how they can be applied. Above all, you’ll learn how to ask e-sign providers to be specific regarding what their services include.

What is a digital signature?

A digital signature, also referred to as “sealing a document”, is not a signature in the legal sense. Rather, it’s about document integrity, which means that in the event of a dispute, you can prove that: (1) no one has altered the original document, and (2) the document you’re presenting isn’t a forgery. It’s like a fingerprint that is unique to that document. As with our own human fingerprints, it’s impossible for any other document to have that same digital signature.

What a digital signature is not:

a method for encrypting documents
a method for securely archiving your documents

What is an electronic signature?

An electronic signature is a method for entering into a legal agreement in a digital environment. Think of it as the digital equivalent of signing your name on a paper document, such as a sales contract. A person signing an agreement creates an electronic signature when they sign an electronic document by clicking a button or drawing their signature with a mouse, touchpad or other input device.

An electronic signature according to the eIDAS regulation is defined as “data in electronic form which is attached to or logically associated with other data in electronic form and which is used by the signatory to sign”.

In US federal regulation, an electronic signature is defined as: “an electronic sound, symbol, or process attached to or logically associated with a record and executed or adopted by a person with the intent to sign the record.” (as stated in the eSign act of June 2000.)

Types of electronic signatures and agreements

There are various methods for expressing agreement, consent and acknowledgment in a digital environment, including:

clicking a button to agree to on-screen text, such as terms and conditions
clicking and/or drawing your signature to sign an electronic document
making a sound or video recording of a verbal acknowledgment
authenticating your identity using a means of electronic identification (eID)

Not all of these will qualify as an electronic signature, and which method to use depends on the situation. Because the legal effect of these methods can vary greatly, factors such as cost of implementation, ease of use (customer experience), legislation, company policies and assessed business risk usually determine which one to use in a given situation.

Even in the category of electronic signature, there are different levels, and which level is appropriate for a given situation will depend on the same factors mentioned above. These levels are explained further in the Scrive Trust Center.

What makes an electronic signature legally binding?

To conform with global contract law, a signature, whether electronic or on paper, must fulfil three key requirements. If someone challenges the validity of a signed document, you must be able to show evidence of: the signing party’s intent to enter into a binding agreement, the signing party’s identity and the document’s integrity, i.e., that it has not been altered.

This third requirement, document integrity, is why you need a digital signature.

DOCUMENT INTEGRITY

For both paper and digital documents, integrity protection is a key requirement. You can retain a paper original, but anyone could easily manipulate an electronic document and claim it’s the original. This makes the integrity aspect even more important when you use electronic signatures.

Document integrity means that in the event of a dispute, you can prove that:

no one has altered the original document
the document you’re presenting isn’t a forgery

To ensure integrity, as soon as a document is electronically signed, Scrive seals it with a digital signature in partnership with our supplier Guardtime. Guardtime uses a method called Keyless Signature Infrastructure (KSI), which uses blockchain technology. Once a document has been sealed with KSI, you can verify its integrity immediately, a year later, even decades later.

KEYLESS SECURITY

Scrive has chosen KSI rather than PKI (Public Key Infrastructure), which is the most common method. PKI works on the model of a trusted party that issues certificates and keys to par
ties who want to protect the integrity of their documents. The issued keys and certificates are used to seal documents. These keys and certificates can be traced back to the trusted party, and trustworthiness is assigned to that party. This is a well-known and relatively straightforward way of sealing documents.

A notable disadvantage of PKI is that the seal becomes more vulnerable to forgery over time, as the possibility increases that someone could mathematically break the seal. As an analogy, a thief trying to break into someone’s bank account using their ATM card would have an increasing chance of success if the ATM didn’t limit them to three attempts to guess the 4-digit PIN.

KSI is not based on certificates and keys, hence keyless, and doesn’t rely on third parties. And unlike PKI, KSI seals become stronger over time because KSI is based on blockchain technology. With KSI, a unique fingerprint of each document is generated and then published in a way that allows you to verify with absolute certainty that your document:

has not been altered in any way
was created on the same date and at the exact time indicated on the document.

For a deeper dive into how Scrive secures document integrity, visit the Trust Center.

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What is a digital signature?

A digital signature is a method for ensuring the integrity of digital documents. It’s like a fingerprint that is unique to that document. As with our own human fingerprints, it’s impossible for any other document to have that same digital signature.

When a document is sealed with a digital signature, you can use this seal as evidence that: (1) no one has altered the original document, and (2) the document you’re presenting isn’t a forgery.

What a digital signature is not:

a method for encrypting documents
a method for securely archiving your documents

The differences at a glance

Whereas an electronic signature is evidence of the document signatory’s agreement, a digital signature is evidence that the document itself is authentic. They work in tandem, and both are needed to make a digital agreement verifiable and legally enforceable.

Is like signing your name on a paper agreement

Is like applying an embossed seal to a paper document

Is created by a person when they click a button or draw their signature

Is created by software

Connects the person to the document

Uniquely identifies the document

Indicates the signer’s intent to enter into a binding agreement

Verifies the document has not been altered or forged

Must include evidence of intent, identity and integrity

Is the method for ensuring integrity

Electronic signature

Is like signing your name on a paper agreement

Is created by a person when they click a button or draw their signature

Connects the person to the document

Indicates the signer’s intent to enter into a binding agreement

Must include evidence of intent, identity and integrity