In India’s digital ecosystem the use of electronic signatures and digital signatures is gaining traction. Understanding legal aspects, use cases and the validity of these signatures within India is an important aspect of conducting business.
Electronic Signature vs. Digital Signature
Before diving into the legality of electronic and digital signatures in India it is important to understand the difference between the two. An electronic signature refers to an electronic recording of the intent to agree to a record. Electronic signatures are marked by its ease of use, with the advantage of signing a document using a verbal signature, like giving consent over the phone. Digital signature on the other hand uses a cryptographic technique which helps in securing the data that is associated with the signed document. The formula of a digital signature is that of a validation, like notaries in the past. Digital signature helps to further validate a document, the online equivalent of a notary.
Electronic Signatures in Indian Law
In India, the Information Technology Act of 2000 (IT Act) is the governing legislation that made electronic signatures and digital signatures legally binding under Indian law. The mission of this legislation was to assist in the availability and use of legal online digital and electronic transactions in a secure environment that decreases the opportunity for fraud like cyber crimes. The IT Act was based on the 1996 United Nations Model Law concerning Electronic Commerce. The two main focuses of the Indian legislation are cyber crimes and electronic commerce and originally consisted of 94 sections that were divided into 13 chapters.
Electronic signature companies that operate in India are concerned with complying with aspects of the IT Act that are more stringent than others in the world. Specifically, companies like ZorroSign focus on a few key areas when operating in India: security, privacy, server location, user experience, and proactively monitoring user generated content in order to comply with Indian Law.
Electronic Signature Use cases
Companies are concerned with reducing cost, saving time and eliminating human error. This can be accomplished by simplifying business processes. With ZorroSign Workflow Automation, businesses can have all that and execute documents online and within minutes. ZorroSign is compliant with all Indian laws, is highly secure and uses Cloud and On-premise deployment options. The eSignature solution allows businesses large and small to offer secure and fully automated document handling. ZorroSign works with existing documents and seamlessly integrates into existing technology infrastructure.
Below are common use cases for ZorroSign’s eSignature and DTM solution:
- Human Resources processes
- Benefits administration programs and processes
- New Employee On-boarding
- Offer letters
- Vacation and time off approvals
- Employee policy distribution
- Facilities management forms
- Wealth and asset management transactions and approvals
- Financing agreements
- Partner agreements
- Non-disclosure agreements
- Invoice processing
- All facets of incorporation documents
- Patent filings
- Shareholder agreements
- Event registration
- Everyday financial transaction requests and approvals
- New account forms processing
- Supplier Compliance Agreements
- General policy management and compliance
- Master Service Agreements
- Price proposals
- Sales orders
- Licensing agreements
- Purchase agreements
- End-to-end healthcare IT processes
- Claims management, payments and prior authorization
- Capture consent
- Expense Reporting
- Regulatory compliance/audit sign off
- Inventory management
- Marketing and photo release forms
Exceptions for electronic signature
Based on the IT Act of 2000, exceptions for electronic signatures and digital signatures exist under law where signatures handwritten in wet ink is explicitly required under Indian law.
- Negotiable instruments, not including a cheque
- Wills and other testamentary documents
- Real estate contracts such as leases and sales, involving transfer of immovable property rights
These exceptions often add to the observation that Indian electronic and digital signature laws are the most stringent in the world with regard to privacy and security requirements.
Electronic Signatures are not fully regulated compared to digital signatures, as most electronic signature providers simply use an image of your signature super-imposed on a document; the authenticity and integrity of the document is often questioned as it is difficult to identify the real owner of the signature. ZorroSign’s patented technology uses handwritten signature which not only captures the intent of singing a document, but actually signs the document, which is accepted by law. With ZorroSign, the electronic signature is real and not just an image and customers are protected against post execution forgery and tampering using our proprietary document 4n6 (Forensics) technology with verifiable audit trail, it’s like a Tamper Seal. ZorroSign is the pioneer of real electronic signature and developer of advanced digital transaction management platform and document tampering detection system, which has been specifically designed to meet or exceed the requirements imposed by Indian law with regard to electronic and digital signature.
For more information on Indian electronic signature and digital signatures laws, please click here.