Qualified Electronic Signature Providers (QES) in Comparison

Electronic signatures, also known as e-signatures, are digital techniques that technically serve the same purpose as traditional signatures on paper documents. In this process, data is linked with electronic information, which is usually electronic documents. This allows the signer or the signatory to be clearly identified and the integrity of the signed electronic documents to be checked. Therefore, from a legal and judicial point of view, electronic signatures can perform the same tasks as an analogue signature carried out on paper.

Electronic signatures are used, for example, in public administration (e-government) or in the judiciary (e-justice). But they are also becoming increasingly popular in companies in areas such as e-commerce or other digital business transactions.

There are three different types of electronic signatures:

• Simple electronic signatures

• Advanced electronic signatures

• Qualified electronic signatures

The legal framework was stipulated in the eIDAS regulation of the European Union.

Simple electronic signature

Most electronic signatures created today are simple signatures. This is because there are no defined requirements for this type of signature, which allows for simple and quick use. This form of e-signature has a relatively low (legal) security, as it is impossible to trace whether something has been changed in the signed document.

A signature can be created by a few clicks without further identity verification, which means that signers can theoretically deny the signature afterwards. Another example of a simple e-signature is a scanned signature on application documents or in an email or the signature made on the display of the handheld scanner during a package delivery.

Examples of documents with simple electronic signatures

• Sales contracts for movable goods

• Service contracts

• Cost estimates

• Order confirmations

• Privacy statements

• General terms and conditions (GTC)

• Confidentiality statements

• Copyright declarations

• Employment contracts etc.

Advanced electronic signature

The advanced electronic signature is safer than the simple electronic signature. Therefore, it is used for financial transactions and the signing of documents with higher legal risks. Unlike the simple electronic signature, the advanced electronic signature must meet stricter requirements for identity verification, which are stipulated in the eiDAS regulation. By meeting these criteria, it has a higher evidentiary value.

According to the regulation, an advanced electronic signature must:

• be uniquely assigned to and associated with the signer.
• enable the identification of the signatory.
• be linked to the electronic data so that subsequent changes to these can be detected.
• be generated by means that only the signer has access to, such as a computer, smartphone or tablet.

These criteria can be met, for example, by uploading and then checking an identity document, which is then added to the proof file. Another method of advanced electronic signature is to add a checkbox for readers to confirm that they have correctly understood a document. All types of identity verification can also be combined, with the aim of further strengthening the e-signature.

Examples of documents with advanced electronic signatures

• Personal insurance, such as accident insurance, life insurance or occupational disability insurance

• Articles of association (GbR, OHG, KG)

• Patent contracts

• Trademark contracts

• Copyright contracts

• Social security documents

• Pension insurance documents

• Open-ended rental contracts

Qualified electronic signature (QES)

The most secure form of electronic identification is the qualified electronic signature. Due to the high requirements for this type of electronic signature, it is only used for specific purposes.

There is a greater legal difference between advanced and qualified electronic signatures than between simple and advanced e-signatures. The criteria that the qualified electronic signature must meet for identity verification and validation and the storage of the signature key are precisely defined in the EU's eiDAS regulation. It is also the only e-signature that is legally equivalent to a handwritten signature.

An electronic signature process is only qualified if it uses a qualified electronic signature issued by a certification authority. In Germany, the certification authorities are controlled by the Federal Office for Information Security (BSI). Similar authorities carry out the certification in other European countries.

While the qualified electronic signature process uses the same security criteria as the advanced electronic signature, the difference lies in the fact that the identity of the signer must be validated beforehand. Furthermore, the signature key must be stored in a qualified signature creation unit (QSCD).

Examples of documents with qualified electronic signatures

• SEPA direct debit mandates

• Bank account opening

• Receipts

• Official business: registration in the trade register, VAT pre-registration to the tax office, annual financial statements, management reports, audit reports

• Fixed-term or part-time employment contracts

• Temporary employment contracts

• Limited rental contracts over one year term

• Graduated or indexed rental or leasing contracts

• Termination letters for rental or leasing contracts

• Capital forming personal insurance

• Life insurance on the death of another person

• Brokerage powers

• Consumer loan contracts

• SIM card activations

• Electronic patient records

• e-tenders for public contracts

What is the difference between electronic signatures and digital signatures?

As described above, the term "e-signature" refers to all types of electronic authentication methods. The methods only have to verify the identity of the signer and can range from a company ID to a verified email account. E-signatures can be equipped with multi-factor authentication to meet increased security requirements if necessary.

The term "digital signature" refers primarily to an encryption method. However, in the context of e-signature software, the term is often associated with a specific type of electronic signature. Digital signatures are essentially a particularly secure, encrypted variant of a digital signature. They usually require a certificate-based digital ID that adds an encryption layer to the identity verification method. The digital signature is then generally validated by so-called certificate authorities (CAs) or trust service providers (TSPs). Both e-signatures and digital signatures can be used for a wide range of business purposes. However, the latter is most commonly used specifically in processes that have clearly increased risk variables. Typical examples of such operations are credit approvals, bank transactions, processes in human resource management, quality and safety approvals and doctor signatures.

E-Signature Software: The best e-signature tools in our comparison

E-signature software provides the ability to sign digital documents. Under the use of an e-signature tool, corresponding writings no longer have to be printed out, signed, scanned again and then forwarded in digital form to responsible places. E-signature systems therefore greatly simplify the flow of documents that require a signature for their validity. Typical areas of application are sales contracts and employment documents, which usually require signatures from customers, employees or partners to become legally valid. Furthermore, e-signature software can be linked with other business-relevant applications, such as CRM software, ERP systems, human resource management suites and accounting programs, to simplify organized processes that require signatures. Note: The e-signature, or in German "electronic signature", is often mistakenly equated with the digital signature. However, the term "electronic signature" refers to a legal situation, whereas the term "digital signature" refers to a mathematical technical encryption method. Nevertheless, they are not completely dissimilar terms or the facts behind them. Because a secure e-signature can be created using a digital signature.

These are known E-Signature software:

• Flixcheck

• Adobe Sign

• sproof sign

• Skribble

• DocuSign

• HelloSign

• eversign

• PandaDoc

• Yousign

• signNow

Good e-signature software comes with, among others, the following features or advantages:

• It allows both senders and recipients to sign documents on a variety of devices and operating systems.

• E-signature software encrypts and secures the communication and shared documents between the users of the solution.

• It lets you track document status and automatically notifies when actions, such as signatures, approvals, etc., are required.

• Roles and permissions can be defined within the system - both internally and for external users, such as contractors, partners, customers, etc.

• It often provides integrated document creation and storage functions and/or allows third-party software to be connected, which extends the e-signature software and/or its application area.

• It helps to save paper and reduce physical file storage.

• E-Signature software creates completely digital processes without media disruptions and ultimately increased process efficiency.

What types of e-signature software are there?

E-signature software can be used for both private and business purposes on document types that require a signature for their legality, such as invoices/work orders, sales contracts, real estate contracts, confidentiality agreements, school forms, lease/rental contracts, insurance forms or cost estimates. The following bullet points explain the different types and uses of e-signature software. In the process, the difference between or the interplay of e-signatures and digital signatures is explained in more detail.

Cloud E-Signature Software

E-signature tools hosted within a cloud are typically aligned as SaaS solutions (Software-as-a-Service). There are usually different pricing models for different requirements. The cloud pricing model typically requires a fixed price per user per month. You can also pay annually. Users use the respective e-signature software within a browser. In fact, many e-signature tools today are cloud solutions. This is not least due to the numerous clear advantages of cloud e-signature software. It is very easy to implement, it does not require hardware investments, it is maintenance-free for users, and it is generally based on a relatively flexible pricing model.

On-Premise Software for Electronic Signatures

E-signature software can also be installed on-site on hardware that is owned by the respective user company and maintained by them. Most customers who use such on-site tools, or entirely in English "on-premise tools", buy a license based on the number of users of the software and pay an annual maintenance fee. On-premise tools can be client-server tools, where the software must be installed on the PC of all users, but browser-based solutions are also possible. On-premise software is still the best alternative in some contexts. However, as it requires IT support for installation and maintenance and usually also requires investments in hardware, such systems are relatively rarely used.

Who Needs E-signature Software?

E-signature software is often used by sales teams hoping to close deals faster because a digital signature is obviously more straightforward to make than one on paper. Besides this possible "steamroller advantage", such positions can of course simply make specific business processes much more efficient through e-signature tools. Paper and various steps of work are saved. Ultimately, practically all business areas in which signatures often have to be made can benefit from e-signature software. E-signature software can significantly support these employees and entire departments with very different functions. There are indeed some products that can't do much more than create an electronic signature. These solutions can often be integrated into other tools, such as an ERP system. However, e-signature tools are sometimes also comprehensive document management platforms, whose functionalities include automatic notifications of required releases, tools for storing or organizing documents, encrypted PDF generation, status tracking, and options for creating individual permissions. Before the advent of e-signature software, document processes that required signatures and involved multiple parties required a significant amount of time. In essence, this meant that the documents had to be physically sent to each party, signed, resubmitted, and copies kept as proof of receipt. Such processes were inherently highly inefficient. In more complex deals, they often took months. Especially in cases where parties made changes or disagreed with a contract, the time spent increased dramatically. E-signature software massively economizes document flow against this. It offers in part diverse functions that are precisely designed to significantly simplify document processes with signatures. It allows specific workflows to be set up and even automatically reminds involved parties to submit signed documents. In fact, e-signature software is mostly used to conclude business contracts, but the technology is also advantageous in a wide variety of other business contexts and industries. Some typical examples of other industries that can significantly benefit from the use of e-signature tools are healthcare, banking, real estate, construction, non-profit organizations, law, and insurance of any kind. Many of these areas, especially banking, insurance, and real estate, are now increasingly dependent on these technologies to efficiently master their daily business operations.

Typical Features of E-Signature Tools

Of course, not every e-signature software on the market has all of the following functions on board, but these are typical components.

• Every e-signature software enables the signing of documents.

• Sometimes, e-signature software reminds signers of documents waiting for their signature and expiration dates of documents.

• The respective tools always offer a secure and seamless authentication process.

• Many e-signature softwares also send documents to mobile devices for signature.

• Some e-signature systems offer workflows that allow senders and/or administrators to easily set up and track documents through multiple signature steps.

• Bulk signatures are possible with some e-signature tools - i.e., they can send documents to thousands of signers at once, in extreme cases.

• Some e-signature software offers the easy creation of custom reports for analyzing the signature process.

• E-signature software can also directly support the creation of signature documents.

• E-signature software often offers scaling for different sized organizations.

• Sometimes, e-signature software allows a custom branding to be applied during the signature process.