Since the ESIGN Act was passed in 1999, electronic signatures have been considered legal and acceptable in most transactions. This law ensures that consumers are protected from fraud by requiring organizations to keep records of electronic signatures and to let signers know that their signature is legally binding. It also gives the public peace of mind and allows people to conduct transactions online.
While the ESIGN Act grandfathers agreements made before October 1, 2000, all future electronic contracts must adhere to its guidelines. Because of this, many people prefer to sign agreements through a paper-based process. In addition, few companies offer paper-based options. However, a paper-based contract is not required by law.
To prevent competing e-signature laws in the United States, the ESIGN Act sets forth guidelines for electronic documents. The act is a federal law that regulates eSignatures and provides legal protection for e-records. The Act also protects the legal enforceability of electronic records.
The ESIGN Act is a federal law governing the use of electronic signatures in commerce. Section 101 outlines the general purpose of the law. Its goal is to prevent any denial of validity because the documents are electronic. In addition to that, it also gives eSigned documents the same legal standing as their paper counterparts. The act also gives parties a right to know whether they have agreed to conduct business electronically.
The use of legal electronic signatures helps keep business documentation flows functional. By eliminating the physical process of signing and scanning documents, legal electronic signatures reduce approval processes from weeks to minutes. It also makes document management easier. In addition, a legal eSignature is recognized and valid in all 50 states. The ESIGN Act protects these eSignatures from fraud and other legal challenges.
The use of electronic signatures is becoming widely accepted around the world. As more transactions are made digital, the E-Sign Act will help companies and individuals sign documents in a safe and secure environment. This will help businesses cut costs associated with printing and scanning paper. ESign technology also improves the speed of document turnaround and keeps signed documents in a secure cloud environment.