What is an Electronic Signature? Everything You Need to Know

Electronic signatures have become an essential part of modern business. Whether you are closing a deal, hiring a new team member, or agreeing to terms with a supplier, chances are you have encountered — or will soon encounter — an electronic signature. But what exactly is an electronic signature, how does it work, and is it legally valid? This guide covers everything you need to know.

Definition: What is an Electronic Signature?

An electronic signature (often called an eSignature or e-signature) is any electronic indication of a person's intent to agree to or approve the contents of a document. It replaces a traditional handwritten ("wet-ink") signature with a digital equivalent.

In practice, an electronic signature can take many forms:

• Drawing your signature on a touchscreen or with a mouse
• Typing your name into a signature field
• Uploading an image of your handwritten signature
• Clicking an "I agree" button or checkbox
• Using a cryptographic digital certificate to sign

The key element is intent. An electronic signature captures the signer's deliberate intention to be bound by the terms of a document, along with a record of when and how the signature was applied.

How Do Electronic Signatures Work?

The process is straightforward from the signer's perspective, but there is sophisticated technology working behind the scenes to ensure security and legal validity:

1. Document preparation. The sender uploads a document and places signature fields where signatures are required. They specify who needs to sign and in what order.
2. Signing invitation. Each signer receives an email with a unique, secure link to the document. This link is tied to their specific email address for identity verification.
3. Signature capture. The signer reviews the document, then applies their signature by drawing, typing, or uploading it. The platform records the signature along with metadata — timestamp, IP address, browser information, and the signer's email.
4. Tamper sealing. Once all signatures are collected, the document is sealed. Any modification to the PDF after signing would invalidate the seal, proving the document has not been altered.
5. Audit trail. A complete record of every action — who signed, when, from where, and how — is attached to the document as a certificate of completion.

The Three Types of Electronic Signatures

Not all electronic signatures are created equal. The eIDAS regulation (used in the EU) defines three tiers, and while Australian law does not use these exact categories, understanding them helps you choose the right level of security for your documents:

For most Australian business purposes, simple electronic signatures are sufficient and legally binding. The Electronic Transactions Act 1999 does not mandate a specific signature technology — it focuses on the signer's intent and consent.

Are Electronic Signatures Legal in Australia?

Yes. Electronic signatures have been legally recognised in Australia since the passage of the Electronic Transactions Act 1999 (Cth). Each state and territory has corresponding legislation that mirrors the federal act:

• New South Wales — Electronic Transactions Act 2000
• Victoria — Electronic Transactions (Victoria) Act 2000
• Queensland — Electronic Transactions (Queensland) Act 2001
• Western Australia — Electronic Transactions Act 2011
• South Australia — Electronic Transactions Act 2000
• Tasmania, ACT, NT — equivalent legislation

For a detailed breakdown of the legal framework and exceptions, see our dedicated guide: Are eSignatures Legal in Australia?

The key exceptions where electronic signatures may not be accepted include wills and testamentary documents, powers of attorney (in some states), documents requiring witnessing, and certain real property transactions. For everything else — contracts, agreements, invoices, HR documents, compliance forms — electronic signatures are fully valid.

Common Use Cases

Electronic Signatures vs Digital Signatures

These terms are often used interchangeably, but they are technically different. An electronic signature is the broad category — any electronic method of indicating consent. A digital signature is a specific type of electronic signature that uses cryptographic technology (public key infrastructure, or PKI) to verify the signer's identity and ensure the document has not been tampered with.

Think of it this way: all digital signatures are electronic signatures, but not all electronic signatures are digital signatures. For a deeper comparison, read our article on digital signatures vs electronic signatures.

Security and Trust

A well-implemented electronic signature platform provides multiple layers of security:

• Encryption in transit and at rest — documents are encrypted using TLS during transmission and AES-256 at rest.
• Unique signing links — each signer receives a one-time link tied to their email address.
• Tamper detection — any modification to the signed document is detectable.
• Comprehensive audit trail — every action is logged with timestamps, IP addresses, and device information.
• Data residency — with platforms like SignAndGo, your data stays in Australia (Sydney), meeting local compliance requirements.

Getting Started with Electronic Signatures

If you are ready to start using electronic signatures for your business, here is the quickest path:

1. Create a free SignAndGo account — 5 free envelopes, no credit card.
2. Upload your first document or choose from our template library.
3. Place signature fields, add recipients, and send.
4. Track progress and download the signed document when complete.

For a detailed walkthrough, see our step-by-step guide to signing PDFs online.