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Everything you need to know about e-signature laws in India

by stacy

The digital transformation of India’s commercial landscape has had a significant impact. Small and medium-sized businesses (SMBs) across a wide range of industries are increasingly relying on digital solutions to improve the efficiency of important business processes, such as sales and marketing.

According to a survey produced by KPMG and Google, digital small and medium-sized businesses (SMBs) in India are growing their profits twice as fast as their offline counterparts. E-signature technology is one of the most significant potential to speed the transition to a digital world.

The Information Technology Act (IT Act), which was passed in 2000, provides e-signatures the same legal validity as handwritten signatures, contrary to popular opinion. E-signatures have been legally valid in India for more than 18 years.

As part of the Digital India project, small and medium-sized businesses (SMBs) are being pushed to use the latest digital technology. As a result, there has been a recent increase in the use of electronic signatures. However, even today, many firms in India do not have a thorough understanding of the regulations governing electronic signatures.

This article will assist you in better understanding what it takes for e-signatures to be considered legally enforceable in India, as well as how to get started.

Obtain a copy of The Complete Guide on Electronic Signature Laws Throughout the World by email.
What sorts of e-signature are accepted under the Information Technology Act?

The Information Technology Act recognises two types of signatures:

(1) E-signatures that integrate an Aadhaar number with an eKYC service are available.

Users who have an Aadhaar ID, which is a unique identifying number granted by the Indian government to all inhabitants, are free to utilise an online e-signature service to sign documents in a safe online environment. An Application Service Provider (ASP) interfaces with the online e-signature service in order to give users with a mobile or web application interface with which they can engage.

This app interface is then used by the users to attach e-signature(s) to any online document after validating their identity using an eKYC service, such as an OTP (one time password) issued by the supplier of the e-signature service. To ensure that certifications and authentication services are provided that meet with government criteria, the online e-signature service partners with an accredited service provider.

2., digital signatures that are formed by using an asymmetric crypto-system and a hash function.

When we say “asymmetric crypto system,” we’re referring to a secure pair of keys that includes both a private key and a public key. The fact that they are both unique to each user means that they can be used to validate and establish an electronic signature.

User’s digital signature is obtained from a trusted Certifying Authority (CA) in the form of a digital certificate in this scenario, which they can use to sign documents. In addition to the user’s name, public key, and expiration date of the certificate, these certificates generally contain additional information about the user. When a CA issues a digital certificate, operating systems and browsers normally retain a list of trusted CA root certificates that can be used to validate the validity of the certificate.

In addition, a USB token carrying the digital-certificate-based ID, as well as a personal PIN, may be supplied to the user in order for him or her to sign a document.

What elements contribute to the validity of e-signature in India?

According to the Information Technology Act, the following are the five requirements that e-signatures must meet in order to be valid:

(1) E-signatures must be associated with the individual who signed the document in a unique way. This criteria is frequently addressed by issuing a digital ID that is based on a digital certificate.

(2) The signer must have complete control over the data that will be utilised to generate the e-signature at the time of signing the document. In order to comply with this requirement, most online e-signature service providers allow signers to immediately affix their e-signature to the document they are signing.

The signature or the document to which it is attached must be detectable if there is any alteration to it or to the e-signature that has been affixed to it. Tamper-evident seals can be used to protect documents from being altered after they have been encrypted.

In addition, there should be an audit trail that documents the procedures completed during the signing process.

(5) The digital signature certificate must be issued by a Certifying Authority (CA) that has been recognised by the Controller of Certifying Authorities (CCA), who was appointed under the Information Technology Act of 2000.

Is it possible to execute any type of document using e-signature technology?

To be legally enforceable, certain documents that require a notarial process or documents that must be registered with a Registrar or Sub-Registrar can only be performed using handwritten signatures, which are notarized or registered. These are some examples:

(1) Other than a cheque, negotiable instruments such as a promissory note or a bill of exchange are acceptable.

(2) Authorizations to act as an agent

(3) Deeds of trust

(4) Testamentary dispositions, including wills and other testamentary arrangements

Contracts for the purchase or selling of real estate, such as leases or sales agreements

Your search for the simplest e-signature solution in India has come to an end.

If you’re looking for an e-signature solution that will let you to sign contracts, invoices, quotations, and other important documents in a timely and legally acceptable manner, Aadhaar e-sign by Signeasy is a good choice.

What distinguishes it as the most straightforward e-signature solution? The use of Aadhaar e-sign eliminates the need to go through the time-consuming procedure of obtaining a USB token that has a digital-certificate-based digital ID. Instead, it allows you to produce a digital signature on the fly using your Aadhaar ID, which you can then use to sign documents.

Moreover, it has a comprehensive filling and signing capability, which integrates nicely with corporate workflows and enables users to complete their documents in a single step.

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