The distinction between digital signature and electronic signature is crucial but often confusing to many. It is essential to understand that these two forms of authentication are not synonymous and have significant differences. While digital signatures focus on protecting data through encryption, electronic signatures have a more legal focus, seeking to certify the will of the signer. Although both terms are used interchangeably, it is important to recognize their particularities and their relationship to each other.

In the past, the handwritten signature was the most recognized representation of the signatory’s consent. However, in the digital age, electronic signatures encompass diverse methods, from codes to biometric data, to identify an individual in relation to a data message. It is essential to note that any digital signature is a form of electronic signature, but not all electronic signatures are digital.

Fundamental differences

between digital signature and electronic signature

The main difference between a digital signature and an electronic signature lies in their fundamental purposes and characteristics. While the digital signature focuses on protecting the security of data by means of cryptographic methods, the electronic signature seeks to attest to the signatory’s will. For example, when accepting the terms of an online service, an electronic signature is used to express the user’s agreement. In addition, it is supported by a regulatory framework in each country.

On the other hand, digital signatures focus on encrypting data to ensure greater security. Although it is also legal, the digital signature requires a digital certificate to validate the signer’s identity, which excludes it as evidence in court. For example, a document that stores passwords can be encrypted with a digital signature, acting more as a key or seal than as a manifestation of will.

Types of electronic signature and their characteristics

In the field of electronic signatures, there are several types with specific characteristics:

• Biometric signature: captures the handwritten signature through biometric devices to collect biometric data.
• Electronic signature with digital certificates: Uses digital certificates issued by competent bodies to validate both the signature and the identity of the signatory.
• Cloud-based signature: Uses a digital certificate hosted on a secure server, with strong authentication.
• Unattended electronic signature: Requires an electronic certificate that does not require active user intervention.
• Single-use code (OTP SMS and OTP Email): Involves sending a single-use code via SMS or email as part of the signature process.

In Colombia, they are mostly classified as: simple, certified and advanced, each with different levels of security and specific uses.

• Simple electronic signature: Offers a lower level of security and is used as evidence in court, although it may require additional elements of proof to guarantee its authenticity.
• Advanced electronic signature: Provides a high level of security and is certified by an accredited service provider, which makes it possible to detect subsequent modifications to the signed document and to verify the signatory’s identity.
• Qualified electronic signature: It is the most robust in terms of security, since it is created by means of a qualified electronic signature creation device and is based on a qualified electronic signature certificate, having the same legal value as a handwritten signature.

Applications in the financial sector

In the financial sector, both digital and electronic signatures play vital roles:

1. Account opening: Electronic signatures enable an efficient and convenient digital process for both customers and banks, eliminating the need to visit a physical branch.
2. Wealth management: In private banking, e-signatures simplify wealth management, reducing the use of paper documents and optimizing time.
3. Loans and credits: Streamlines the application and approval process, increasing customer satisfaction and reducing the application abandonment rate.
4. Business Banking: Simplifies new customer onboarding processes, streamlining service delivery and improving the customer experience.
5. Construction finance: Critical in delivering a fast and convenient process, improving the customer experience and enabling process automation for finance companies.

In all these scenarios, the choice between digital and electronic signature depends on technical, legal, financial and user experience analysis. In summary, digital signatures are ideal for documents that need to be sent digitally, while electronic signatures are used to validate identities, ensure security and confidentiality, mitigate repudiation and improve the user experience in any electronic environment.