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    Sign In: The growing relevance of e-signatures for banking

    Synopsis

    According to a 2017 Forrester study, the market for e-signature software and services is expected to grow at 60% percent CAGR between 2015 and 2020 and cross 90 million transactions in that period.

    Digital SignatureThinkStock Photos
    Employees can use time saved on document generation, negotiation, tracking, and storage to focus on higher value tasks.
    By Kulmeet Bawa

    When was the last time you walked into your bank for a basic transaction? I cannot recall doing so, in recent times. Thanks to technology, banking transactions have significantly moved from face-to-face to digital platforms - ATMs, kiosks, smartphones, tablets, and online. While this trend has already enhanced customer convenience and driven down expenses significantly, there is a lot more that will change in the days to come.

    Several banking transactions such as loan approvals, account openings, and investments have not experienced this digital revolution because of the stringent requirements of customer signatures. The adoption of electronic signatures (e-signatures) into these processes will prove to deliver significant and quantifiable results in terms of reduction in cost, speed of transaction completion, and enhanced customer satisfaction.

    According to a 2017 Forrester study, the market for e-signature software and services is expected to grow at 60% percent CAGR between 2015 and 2020 and cross 90 million transactions in that period. The banking industry claimed that the adoption of digital signatures was very important to complete their digital transformation.

    The Indian government, working with banking and other industry representatives and recognizing the significant efficiencies in time and resources associated with digitizing the document transmission and signature process, passed laws to bolster the legality of e-signatures. Information Technology Act, 2000 (IT Act) recognises electronic signatures, or e-signatures. As a result, there has been a recent increase in the use of e-signatures, with more and more services using them. This, in part, is due to the government's focus on enabling electronic transactions using Aadhaar, the unique identification number issued by the Indian government to all Indian residents.

    Key Benefits:
    With templates and forms, employees can quickly generate a document for signature, send it directly to the right signers, and use tracking features to speed signature retrieval. Mobile competencies further accelerate signature cycles by allowing traveling signers to easily sign from any device, and security features ensure sensitive data is protected. Employees can use time saved on document generation, negotiation, tracking, and storage to focus on higher value tasks. Customers can sign new deals or renewals faster through a more streamlined and secure signature process.

    Studies have shown :
    1. Savings of 1.3 hours per transaction by eliminating inefficiencies in preparing documents, negotiating or reviewing documents, tracking, rekeying, and archiving.

    2. Cost savings of $11 per transaction by switching to a digital signature process, reduce costs for shipping, paper, ink, printers, and scanners.

    3. Faster sales cycles with templates, CRM integrations, and tracking features, cycle times are reduced by as much as two weeks, customers are onboarded faster, and one group saw revenue grow by over 20%.

    4. Faster contract turnaround, improved document security, and reduced team time spent on contracts from hours to minutes each day.

    5. Reduced environmental impact through the reduction in paper.

    E-signatures offer improved security and compliance because of the ability to route sensitive documents directly to signers and add security features such as passwords or digital signatures for certain regions. This also results in the reduction of compliance risk in several areas, including fewer errors on signed documents, templates to standardize and lock down documents, tracking functionality that provides an audit trail, and integrations with document repositories that ensure documents are properly stored. A paper document can be modified after being signed by an unauthorized person, but as counterfeiting e-signatures is virtually impossible, the integrity of the data is assured.

    Banks are taking advantage of e-signatures to reduce their operational costs. For example, HDFC Bank, Citibank, and ABN Amro Bank (cited in this article) are using the technology in respect of statements of accounts for savings, current and credit cards, and electronic contract notes for equity brokerage transactions - cutting down on paper and time and improving the customer experience.

    The opportunity for significant cost savings, inherent security, increased global legal acceptance, and the rapid acceptance of SaaS-based solutions incorporating mobile technology will fuel continued growth of e-signatures into the future.

    (Kulmeet Bawa is Managing Director, South Asia, Adobe.)


    (Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com.)
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