What is Digital Signature and How it Works?
(Photo : What is Digital Signature and How it Works?)

Electronic signatures are a massive time saver. They can collapse weeks of administration into days, and hours of signing documents into minutes.

There is a popular misconception that digital signing is difficult to set up and might not be secure. However, these myths have long been debunked by digital signature service providers who have developed an easy-to-use platform that provides its users with independently verifiable digital signatures offering protection to the integrity of digital documents. Provision is also made for verifying the signer's identity and what time the document was signed.

Part 1: How Does a Digital Signature Work?

A digital signature is a special form of signature that uniquely links a signer to a document. It makes use of a standard format known as Public Key Infrastructure (PKI) to verify a user's identity and protect the contents of the signed digital document.

Using this PKI protocol, two keys are usually generated by the digital signature provider e.g. CocoSign; one a private key and the other, a public key. The private key is kept securely by the signer in a secure HSM box and is used to encrypt the document while the public key is utilized by the recipient to decrypt the message on the other end.

Once a user digitally signs a document, a cryptographic hash function is produced. This hash, a fixed-length of numbers or letters generated by an algorithm is then encrypted using the signer's private key. The hash function is appended to the document before the document is sent over to the recipient alongside the public key to decrypt its contents.

At this point, the recipient is required to decrypt the hash function using the public key certificate. Once the recipient signs, another hash function is generated on the recipient's end.

Both hash functions are then compared to decipher the document's integrity. If both hash values match, the signature is considered valid and the document has not been tampered with.

Part 2: What Are the Benefits of Digital Signatures?

Digital signatures have come to stay. The benefits they present to their users are streets ahead of what you get with traditional wet-ink signatures. However, to get the most out of them, you must use a reputable digital signing solution. 

Because then, and only then can you be assured of secure digital signature transactions and independently verifiable signatures. The following are some of the benefits of digital signatures.

Legally binding and secure

Digital signatures are legally binding and secure since the brand complies with industry set standards and many countries signing laws. The digital signature provider also makes use of top-notch advanced encryption protocols to keep all transactions with the platform secure.

Legally binding and secure

Independently verifiable signatures

When it comes to digital signatures, it is important that they are independently verifiable. Otherwise, the digitally signed document may no longer be verifiable once the signing solution goes out of business. 

Audit trail

Digital signature services provide their users with a reliable audit trail that keeps track of every activity. This includes taking note of names, email and IP addresses.

Protect document

Since the document is cryptographically and securely bound to the digital signature, users can be rest assured that their documents cannot be tampered with.

Track and monitor

With a digital signing solution, you no longer have to pester your clients, employees and business partners to find out whether or not they have signed your contract documents. With the track and monitor feature, you can track the document's status on-the-go to know who has or hasn't signed yet.

Sign on-the-go

Since the platform is accessible through all internet-connected devices, you can digitally sign as many documents as you wish to while on-the-go, without any needs to connect to a desktop before you can sign those bundles of legal documents or contracts.

Control the sequence

From the platform's dashboard, users can define the order in which they want their documents to be signed. The user can choose to go with a parallel or a series sequence.

Secure storage

The free electronic signature provider has a secure storage system that temporarily stores documents till the user deletes them or till they auto-expire. Once deleted by the user, the documents are automatically and completely deleted from the platform's servers.

Part 3: Types and Uses of A Digital Signature

There are different types of signatures, all of which can be grouped into three classes.

Class 1

Since they can be validated only by a username and email ID, they cannot be used for legal documents.

Class 2

Here, the identity of the signer is validated against a pre-verified database. They come in handy where there is an organized database. An example of where this is used is in the online filing of tax returns.

Class 3

Used for court-filings and online auctions, they offer the most advanced form of security. Before signing, the signer must present him or herself to a certifying authority to verify that they are who they say they are.

Digital signatures have become the mainstay signing process for many industries. Here are the most popular use cases of digital signatures: 


These days, the government makes use of digital signatures for faster processing of tax returns and the management of several contracts. Congressional bills and government notices are now printed in digital formats with digital signatures.


It is used in the marketing industry to speed up processes like marketing and sales. In the manufacturing clime, they are usually regulated by the ISO, NIST and DMC.

Financial services

Unlike elsewhere, the use of digital signatures in the financial sector is highly regulated. This is done to reduce incidences of fraud and forgery. All digital signatures used in the financial sector must comply with the guidelines and rules set by eIDAS, E-Sign Act, UETA, FFIEC and CFPB.

Here, digital signatures are used to process loans, mortgages and to make banking transactions truly paperless.


They are used in the healthcare industry to speed up treatment and administrative processes. They are also used for online prescriptions, and strengthening data security.

Part 4: Digital Signature FAQs

Can someone falsify my digital signature?

Digital signatures are highly secure. Hence, it can be very difficult to falsify. For a digital signature to be falsified, the criminal must have access to the signer's private key which is a very unlikely event. However, if that happens, the signer can revoke the trust in the compromised key using another key provided by the Certificate Authority (CA) that issues certificates.

If you are using a digital signature be rest assured that it cannot be forged. However, in the unlikely event that it is forged, it's very easy to resolve the problem.

What is a Certificate Authority?

It is now an established fact that digital signatures depend on a public and private key. To cut down on incidences of forgery and whatnot, these keys must be created securely and stored safely. But how are you sure these keys are valid in the first place? That's where a certificate authority comes in.

They are the gold standard for key security and digital certificates. In other words, they are recognized by the industry as reliable for ensuring key security. Both the signer and the recipient must agree to use the same CA to provide them with necessary digital certificates.

What is the point of using a digital signature?

First things first, lots of businesses now make use of electronic signatures because they help them cut down on printing and mailing costs; and also help them reduce the time needed to process contractual agreements.

However, for legal documents, e-commerce transactions and many authentication schemes that need a high level of security, you might want to consider using a digital signature. This is because they can be used to verify that the signatory is who they claim to be.

Can a document with a digital signature be trusted?

Yes, it can since the signature becomes invalid once the document has been tampered with post-signing. Once the contents of a document has been modified, the hash value from the signer's end would no longer match the hash value from the recipient's end.

Also, should the signer's private key be compromised, the digital certificate can be revoked.

How do I know what digital signature solution is perfect for me?

Here are some guidelines to help you determine what digital signing solution is best for you:

  • The digital signature provider must comply with laws and regulations like E-Sign Act and eIDAS

  • It must be easy to integrate it into your business' workflow

  • A batch signing features comes in handy

  • The digital signatures must be backed by a reliable CA

  • Signatures must be independently verifiable

  • Platform must be simple and intuitive


If you have reason to sign through several reams of paper each day or work remotely, it is high time you considered a digital signature. In addition to making you more efficient and progressive, they are legally binding and help you validate the signer's identity. Integrating a reliable online signing solution into your workflow can help you close deals faster and more efficiently.

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