Businesses that are able to quickly adjust to changes in strategy, regardless of the reasons for the deviation, will have a competitive edge. A great method for financial sector businesses to do this is to digitize their core services.
Meeting in person has long been the standard practice for a wide range of financial transactions, including account opening, mortgages, vehicle loans, and more.
However, thanks to digital signatures, it is no longer necessary to physically move paper contracts across a desk.
When it comes to the financial industry, creating handwritten signatures online have many advantages.
In most fields, electronic signatures are now preferred over traditional paper ones because of their efficiency and convenience.
Electronic signatures are becoming increasingly common as more and more businesses move their services online.
The Advantages of Using Electronic Signatures in the Financial Industry are Discussed Below.
1. Reduced Transaction Time
Using manual signatures slows down all procedures and transactions. Example: the banking industry’s stringent “Know Your Customer” (KYC) regulations, which call for extensive, cutting-edge identification verification.
You may be oblivious to the time it takes because you’re used to doing things the old way, but switching to electronic signatures will dramatically speed up the process.
Customers can now sign papers electronically, eliminating the need to wait for physical signatures, and their identities can be quickly verified for KYC purposes. Signing can now be done on customers’ mobile devices at any time and place.
There’s no need to do a bank run. Instead of taking hours or even days, as is the case with the manual procedure, all of these steps can be done in a matter of minutes.
2. Streamlined Operations
One of the most time-consuming and difficult activities in the financial business is gathering signatures from various departments.
This time commitment can be reduced by automating and digitising signing operations. With a digital procedure, there will be no need to print, photocopy, scan, and email any legal documents or applications (such as loan, credit, or debit card applications).
With document signature software, businesses may streamline their operations by signing several contracts with only a few mouse clicks. It also has the added benefit of allowing you to notify and remind signatories of any documents they have still to complete.
3. Greater Transparency
When dealing with money, honesty and openness are absolute musts. To everyone’s relief, electronic signature implementation simplifies and expedites what could otherwise be a tedious and time-consuming process for both the lender and the borrowers. Multiple signatories are typically required for loan applications.
It might be difficult to keep track of where clients are in the contract signing process when sending out contracts through fax or paper.
Electronic signatures provide financial organizations with more insight into their clients’ signing activities. As a result, you can better time reminders and notifications to guarantee a seamless transaction.
4. Improved Document Security
Wet-ink signatures on paper contracts are easy to counterfeit, and paper copies are readily lost or stolen. Financial organizations can rest easy knowing that agreements made between systems are protected thanks to the use of digital documents and electronic signatures.
The benefits of electronic signatures are unchangeable because of the encryption technology used to secure them.
In addition, financial institutions can detect any changes made to an electronic contract after it has been signed and implemented because of tampering with evident and extensive auditing features provided by electronic signature solutions like Wesignature.
Furthermore, organizations can ensure that their papers stay private and secret at all times with the use of technologies like two-factor authentication (2FA) and knowledge-based authentication (KBA), which both need additional steps to be completed before access is granted.
5. Industry Compliance
Any company doing business in the highly regulated financial services industry must follow rigorous industry and legislative standards.
Leading certification agencies including PCI DSS, Soc 2 Type II, 21 CFR part 11, eIDAS, ESIGN, and UETA all recognize and approve of electronic signatures.
In addition, industry-specific compliances have never been easier to meet thanks to the availability of tools for fast and easy identification, the utilization of detailed audit trails that show all movement of any document, the assurance of a tamper-proof and secure process, and the facilitation of fast, easy, and organized document access.