In the “lifecycle” of a contract, from the start of negotiations to the end of its validity, signing and archiving documents take up only a small amount of time. Nevertheless, they are significant cost factors for companies.
The reason: contracts are often signed inefficiently on paper and have to be physically archived. Every time a document comes into contact with a human in this way, costs are incurred – for example, by sending it by post or indirectly by the working time spent on transport, processing and archiving.
But there’s another way: digitizing contracts and signing them digitally cuts time and costs enormously – on all sides. Find out how you can save almost 50 euros per signature.
The contract signature interface often generates high costs
Even in companies where digitization is supposedly far advanced, everyday life often looks like this: Communication with customers or other companies happens almost exclusively digitally. Contract negotiations or even exchanges following the successful conclusion of a contract are conducted entirely online by mail, telephone or video conference.
In this way, all partners save time, costs and emissions that would otherwise be caused by business trips, for example. The advantages of the digital world are fully exploited.
When it comes to the actual signing of the contract, on the other hand, the procedure seems downright anachronistic: the contract is printed out on paper and sent to the other contracting party to be signed by hand, unless a representative of the parties physically travels to the location to sign it.
The signing of the contract itself is therefore not digital and generates effort and costs in the process:
- Printing costs
- Costs for traveling or sending by mail
- Waiting times for the signature
- Costs for processing and archiving
The latter point also plays a major role in the long term. After all, if a contract is physically signed, it must be properly stored so that it can be presented as evidence in court if required.
Although it is also possible to “digitize” contracts in these cases, for example by scanning them, this also generates effort and it is at least questionable whether a scan alone has enough legal significance so that additional physical storage still seems necessary.
For a single contract, this effort may still be justifiable. But if the volume of contracts is large, for example because contracts are part of your business model such as leases in the real estate industry, the costs of analog contract management add up and can represent a significant portion of your total business costs.
Digitizing contracts has big advantages
Suppose contracts could be signed and archived completely digitally with full legal validity: The benefits become apparent at first glance.
- The time required for the signing process can be reduced to a few minutes.
- There are no costs for printing, mailing or travel of signatories.
- Archiving can take place digitally, making it much more time and cost efficient.
If contracts with customers are part of your business model, there are additional advantages:
- You offer your customers a much more convenient user experience, setting you apart from the competition.
- You can process more contracts in the same amount of time and, due to the reduced costs – estimated at up to almost 50 euros per signature! – additionally increase your profit margin.
- You can identify signers without a doubt and thus put a stop to fraud.
You can read more about the benefits of digital contracting in the linked blog article.
Successfully digitize contracts
The crucial step for digitizing contracts is the act of signing the contract itself. If you can handle this digitally, the rest of the benefits follow virtually automatically.
Fortunately, digital signing of almost all contracts is already possible and legally compliant today! Digital signatures, as defined by framework regulations such as eIDAS in the EU or ZertES in Switzerland, offer full legal validity with significant cost savings.
For example, signing a contract digitally with legal validity takes only a few minutes with Certifaction’s solution. How exactly this works can be seen in the linked article, including step-by-step instructions.
In cases where retention in paper form is legally required, the digital twin is there for you, which you can generate with one click from the Certifaction app. Here, too, the contract signature takes place in the digital world, so you can still profit from significant cost savings.
Digital contract management & data protection
Some providers also offer complete digital contract management solutions in addition to digital signatures. However, in most cases, these have one glaring flaw: data protection.
If your data is on the servers of a contract management provider, it is not uncommon for the provider to have direct access to it. Some providers even advertise this as an advantage, for example by marketing artificial intelligence for the automatic evaluation of contracts as a feature. The question arises: if an AI can access your documents, can a human employee?
If your documents contain very sensitive information, this is a big risk. Especially since it’s not just the contract management vendors themselves who can potentially gain access, but also cybercriminals, industrial spies, or even actors like the U.S. government, which can have data released from any company based in the U.S. via the CLOUD Act.
Some companies rely on no-sign lists for particularly sensitive documents, but these also generate effort and additionally hinder digitization. There’s a better way:
With end-to-end encryption (E2EE), where the data already leaves your end device encrypted, eSignature providers can’t read your data in the first place. This way, you also don’t have to worry about someone else reading it. This is the approach Certifaction follows.
Get informed and benefit
Digitizing your contracts can benefit you enormously in the long run. The most important step here: digitizing the contract signature. This is very easy with applications like Certifaction – a signature takes only a few minutes and saves you almost 50 Euros at the same time.
Try our free version or contact us via the contact button below. We will be happy to advise you on how we can digitize your business and make it more profitable.
Also feel free to use the other resources on our website. For example, did you know that simply scanning signed, fixed-term leases does not meet the formal requirement in Germany, but a Qualified Electronic Signature does?