Digital signature technology has been instrumental in aiding businesses in their effort to move towards a more paperless office. In addition to streamlining their workflows with their employees and their clients, digital signatures provide a higher level of security than traditional pen-and-ink signatures on paper documents. With the alarming number of cyber scams, phishing attempts and other threats businesses encounter on a daily basis, their ability to verify the legitimacy of emails, software updates, and documents has never been more crucial.

Digital signatures are fast, easy to use, and they save time and money. But what exactly is a digital signature and how does digital signature security work?

What is a digital signature?

A digital signature serves as a virtual “fingerprint” used to verify the identity of the signer and the digital document they sign. Like handwritten signatures, digital signatures are unique to each signer, but provide far more security than traditional pen-and-ink signatures. In addition to the enhanced security built-in to the technology, digital signatures can prove the origin, identity, and status of electronic documents.

Digital signatures are a specific signature technology implementation of an electronic signature that ensures compliance with legal regulations by providing the authenticity and validity of a digital document and the signer’s identity.

SIGNiX’s true digital signatures permanently embed legal evidence into the signature and the document signed. Unlike other digital signature vendors, where the user must rely on the vendor to provide access to the proof that shows the legality and validity of their signature, SIGNiX users own their data and can prove the authenticity of their signatures and their documents.

Digital Signatures vs Electronic Signatures

Before we dive into how the security behind digital signatures work, it’s important to make the distinction between digital signatures and electronic signatures.

Digital signatures are the most secure type of electronic signature technology available. Some other, less secure types of electronic signature use common electronic authentication methods like an email address, a username or ID, or a phone number to verify the signer’s identity. Digital signatures use Public Key Infrastructure from a Certificate Authority to authenticate a signer’s identity and a document’s integrity by encrypted binding of the signature to the document.

Digital signatures can be verified independently, without relying on a vendor, unlike electronic signatures, which require the vendor to prove the legitimacy of the signatures and the document itself. Lots of electronic signature vendors link their signatures to a centralized server instead of embedding the signatures into the document as is the case with digital signatures.

SIGNiX’s true digital signatures provide the convenience of electronic signatures combined with the enhanced security of digital signatures.

How does digital signature security work?

Digital signatures serve as irrefutable data that proves the signer’s digital identity and the authenticity of the communication, whether it be an email, document, or other important piece of data. Digital signatures cannot be faked by hackers, and they are easily verified by the recipients’ computers or servers.

As mentioned previously, digital signatures use Public Key Infrastructure (PKI), which is used to manage identity and security in internet communications. Recognized as the gold standard for digital identity authentication and encryption, PKI uses a key pair system consisting of both a private key and public key. PKI also includes regulations, protocols, rules, people, and systems that aid the distribution of public keys and the identity validation of users with digital certificates and a certificate authority.

When a signer signs a document with their digital signature, a mathematical algorithm generates data pertaining to the document and then encrypts the data called a cryptographic hash. A hash function - a fixed-length string of numbers and letters generated from a mathematical algorithm – is unique to the file being hashed and cannot be reveres to find other files that may generate the same hash value. The signer has sole access to the private key which is used to encrypt the document data. The encrypted hash or encrypted information is then transmitted and can only be decrypted by the signer’s public key. The receiver of the document also receives a copy of the signer’s public key which is used to decrypt the signature. On the receiver’s side, a cryptographic hash is once generated. Both cryptographic hashes are checked to validate their authenticity. If both hashes match, the document is considered genuine.

Why are secure digital signatures important?

Compared to physical paperwork and traditional “wet” signatures, digital signatures provide more efficient workflows and enhanced security as well. Additionally, digital signatures protect sensitive online data and improve document management overall. 

Common documents signed with digital signatures

Digital signatures are commonly used for an array of different digital documents in order to improve security and efficiency of important business transactions, including:

Government forms: At the federal, state, and local levels, government agencies have stricter regulations and guidelines than many private sector businesses. Digital signatures have a variety of use cases in the public sector including building permits, timesheets, and remote work request forms. By using digital signatures, these processes become more efficient and more secure, ensuring the correct employee is involved in the appropriate workflow.

Healthcare data: Data privacy is crucial in the healthcare industry for both research data and patient records. The secure technology of digital signatures ensures that this sensitive information has not be tampered with when shared between consenting parties.

Financial documents: To prevent a bad actor from trying to scam buyers into sending payment to fraudulent accounts, financial departments use digital signatures to sign invoices so their customers can be confident the payment request is coming from the proper seller.

Shipping documents: For manufacturers, digital signatures help reduce costly shipping errors and ensure cargo manifests and bills of lading are always accurate. With traditional signatures and physical paperwork, the process can be cumbersome, and documents cannot be easily accessed or, even worse, lost in transit. Shippers and receivers can access the files they need quickly, verify signatures are authentic, and confirm no tampering has occurred when they use digital signatures.

Sales agreements: Both the buyer and seller’s identities are authenticated when they use digital signatures signing contracts and sales agreements. Each party will have peace of mind that the signatures are legally binding, and the terms and conditions of the agreement have no been altered.

Contracts and legal documents: The legality of digital signatures make them ideal for any legal document requiring an authenticated signature by one or more parties. The tamper-proof properties of digital signatures assure both parties that the document they signed has not been tampered with.

True Digital Signatures from SIGNiX

SIGNiX exclusively uses digital signatures to make signing documents online safe & secure with comprehensive legal evidence permanently embedded in each document to eliminate any dependence on SIGNiX. With true digital signatures from SIGNiX, our partners and their clients get the highest level of document security possible. Signed documents are tamper-evident and come with a highly detailed audit trail giving more than enough evidence in the event of arbitration. Many firms prefer to store confidential client documents on their own servers, and SIGNiX's exclusive Vendor Freedom technology gives firms this option since the necessary legal evidence is permanently embedded in every document. 

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