Electronic signatures (e-signatures) are transforming the way businesses handle approvals, contracts, and compliance. According to Fortune Business Insights, the global e-signature market was valued at $10.8 billion in 2025 and is projected to reach $118.8 billion by 2032, growing at a CAGR of 40.9%.

This article explores what e-signatures are, the types of electronic signatures, best practices for adopting e-signatures, how they work, and why your company needs them, along with how Youverify makes the compliance process seamless.

What is an Electronic Signature?

An electronic signature, or e-signature, is any electronic mark that shows a person’s intent to approve or agree to a document. This could be:

1. Typing your name

2. Checking an “I agree” box

3 Signing on a touchscreen with a stylus

 

E-signatures make processes faster, paperless, and auditable. In fact, DocuSign reports that companies using e-signatures cut document turnaround time by 75% and save $4–10 per document in administrative costs.

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What Are the Types of Electronic Signatures

Electronic signatures fall into three main categories, defined by their security level and legal enforceability.

1. Simple Electronic Signature (SES)

• Simple form like typed name, scanned signature, or check box.

• No additional security or identity verification/confirmation.

• Suitable for low-risk uses such as HR onboarding or internal memos.

2. Advanced Electronic Signature (AES)

• Comprise audit trails, encryption, and authentication of signers.

• It links to the signer and detects tampering.

• Suitable for financial contracts and supplier contracts.

3. Qualified Electronic Signature (QES)

• Under eIDAS regulation, it is legally equivalent to handwritten signatures

• It needs verification of identity by a Qualified Trust Service Provider (QTSP).

• Used in highly regulated industries like finance, healthcare, and law.

Interesting read: What is a Qualified Electronic Signature (QES)

Comparison of Electronic Signatures (SES vs AES vs QES)

The three types of electronic signatures differ mainly in their security, legal recognition, identity verification, and use cases.

1. Simple Electronic Signature (SES):
SES offers the lowest level of security and provides only minimal identity verification. This type of digital signature is moderately recognized in the EU but does not provide tamper detection. This makes it most suitable for low-risk documents such as HR forms, internal memos, or simple approvals.

 

2. Advanced Electronic Signature (AES):
AES provides a higher level of protection through encryption, authentication, and audit trails. It requires identity verification and includes tamper detection, which strengthens its legal recognition across the EU. Common use cases include contracts, NDAs, and business approvals where authenticity is important.

 

3. Qualified Electronic Signature (QES):
QES is the most secure and legally recognized type of electronic signature. Under the EU eIDAS regulation, it is equivalent to a handwritten signature. It requires strict identity verification by a Qualified Trust Service Provider (QTSP) and offers tamper detection by default. QES is often used in legal filings, healthcare records, cross-border trade agreements, and highly regulated financial transactions.

Why Do Businesses Need Electronic Signatures

Digital transformation demands agility and security. Businesses are switching to e-signature because of the following reasons:

1. Organizations save the cost of handling documents by using e-signatures. 
2. Businesses using e-signatures close deals faster.
3. Reduction in operating costs (no paper, printing, or courier fees).

Best Practices for Using Electronic Signatures

To ensure security and compliance, follow these best practices:

1. Use AES or QES for sensitive contracts.
2. Always maintain audit trails.
3. Verify signers’ identities with multi-factor authentication.
4. Align with local and international regulations (e.g., eIDAS, ESIGN).
5. Integrate e-signature with your compliance workflows
 

Which Documents Can You Sign with e-signatures?

Common use cases:

1. Sales contracts and purchase orders
2. Employee onboarding documents
3. Loan agreements and NDAs
4. Lease and rental agreements
5. Vendor onboarding and supplier contracts
6. Insurance policies and government forms

Key takeaway: All types of digital signatures are electronic signatures, but not all electronic signatures are digital signatures.

What Are the Acceptable Forms of Electronic Signatures

Acceptable e-signature forms vary by country and industry. Typically, it includes:

• Names typed in documents

• Scanned handwritten signatures

• Click-to-sign checkboxes

• Touchscreen signatures

• Biometric authentication (e.g., fingerprint, facial recognition)

• Cryptographically secure digital certificates

The Evidence Act 2011 in Nigeria recognizes the admissibility of electronic signatures in commercial transactions or deals.

You might like to read What is Electronic Identity Verification 

How Do Digital Signatures Work

A digital signature uses cryptography to verify data authenticity. Here’s how the types of digital signatures work:

1. A private key uniquely signs the document.

2. The signer’s public key verifies it.

3. If altered, the signature becomes invalid—protecting the signature against tampering.

IDC reports that the adoption of digital signatures reduces fraud risk by up to 60%, especially in financial services and legal environments.

What Countries Are Electronic Signatures Legally Binding?

Yes. E-signatures are legally binding in over 60 countries, including:

• Nigeria 

• United States 

• European Union 

• UK 

• India 

• Australia, Canada, South Africa, and more

The legality of using e-signatures depends on meeting the law’s requirements: intent, consent, identity verification, and document integrity.

Which Documents Can You Sign Using e-signatures

Common use cases of e-signature:

• Sales contracts

• Employee onboarding

• Purchase orders

• Loan agreements

• NDAs

• Lease and rental contracts

• Vendor onboarding

• Insurance policies

• Government forms

Exceptions to using e-signatures include wills, family law matters, and court documents in some jurisdictions.

Conclusion

Electronic signatures aren’t just a digital convenience; they’re a strategic imperative. In today’s increasingly digital and compliance-driven business landscape, slow, paper-heavy workflows are simply unsustainable. Whether it's onboarding new employees, closing loans, or bringing clients on board, e-signatures accelerate operations, reduce costs, and offer legal protection.
 

Partner with Youverify a fraud prevention and compliance solution provider in real time, and begin onboarding customers seamlessly while ensuring regulatory compliance. To get started, book demo today.