OTP-Based eSign or Digital Signatures For Businesses – Know Which One Is Suitable For You

Digital Signatures or OTP eSign? Which One Should You Adopt For Your Business?

otp esign vs digital signature

Signatures assure the legality of any document and online signatures are a convenient alternative to wet signatures as they facilitate the completion of business protocols in no time. Digital signatures and OTP-based eSignatures are key to validating various business processes and choosing the right option can help advance your business workflow.

Both these online signing alternatives are beneficial for businesses to complete their documentation and contract workflows in a matter of minutes. People can sign the required documents remotely, enabling businesses to boost speed and convenience in their document & onboarding workflows.

Read further to know all about OTP eSign and digital signatures. Businesses can analyze the different advantages offered by each of these variants in order to adopt the most beneficial digital document legalization procedure suitable for them.

What are Digital Signatures? 

A digital signature is a cryptographic sign that is unique to the signer and the document being signed. The cryptographic technology employed on these signatures uses digital keys & public-key cryptography in order to secure the document being signed. Some of the major features of digital signatures include,

  • Enhanced Security: Digital signatures offer inherent security to the document being validated as compared to a handwritten signature. Online digital signatures offer an additional layer of protection to secure the document that has been signed. The security offered by these forms of signatures ensures the documents are not altered. 
  • Long-Time Validity: Digital signatures are legally binding and admissible in a Court of Law, the same way as traditional wet signatures. 
  • Authenticity: Digital Signature Certificates or DSCs generated during this signing procedure allow for quick verification. The DSCs are issued by Certifying Agencies (CA) authorized by the government. These certificates are digital equivalents of physically signed certificates.

What is OTP eSign?

OTP eSign is a type of electronic signature that enables users to sign a document digitally using a one-time password or OTP. These signature systems provide the user with a temporary passcode to conveniently sign the document from any device. The user receives a unique link via email or SMS, enabling him/her to validate the document remotely.

There are different ways in which an OTP-based signature can be implemented. One of the ways is the straightforward method wherein the user receives an OTP to his registered email ID or mobile number to carry out the eSignature. Once the password has been entered, the document would be electronically signed.

Another method of authenticating contracts and documents electronically is via Aadhaar signing. In this method, the user receives the OTP on his/her Aadhaar registered mobile number. Post providing the one-time password, the user’s details are retrieved from the UIDAI database and the document is validated. Some of the important features of OTP eSign include,

    • Flexibility: OTP eSignatures allow flexibility in terms of the physical presence of the signee. He/she can be present remotely and sign the document using only his phone or laptop. 
    • Saves Time and Expenses: OTP-based electronic signatures are simple and fast, as they do not require the signee to use a specialized software/application or want them to be physically present on-site while signing.
    • Inalterability: Since the OTP would be valid for only a certain amount of time, the signature once generated cannot be altered at a later date. 

Benefits Of Digital Signatures For Businesses

Advantages of Digital Signature

  • Security: The digital signature software used in the creation of digital signs adds a layer of security to the document. It does so by using encryption software that aids in keeping the document tamper-proof and prevents it from being wrongly used. 
  • Risk-Free Process: By using digital signatures in their documents, businesses can stamp out the risk of forgery. As these signatures are supported by unique digital identities that can be accessed via accepted public key infrastructure standards. 
  • Authenticity: As these forms of signatures come with DSCs or Digital Signature Certificates, they offer legal validity. 
  • Convenience: Parties can sign the required documents remotely and businesses can provide multi-party access for a single document, based on their requirements. In addition, the time stamp feature available on these digital signatures offers enhanced trackability and eases customer audits. 

Benefits of OTP eSign For Enterprises

Advantages of OTP esign

  • Simplicity: As the OTP would be sent to the user via SMS or email, he/she does not need to install special applications to complete the process. 
  • Tamper-Proof: The inalterability offered by OTP-based online document signing services, makes them highly desirable for high-security business documents. One-time password-based signing ensures the signatures once generated are not tampered with or deleted.
  • Speed: OTP eSignatures save time by offering a fast process that the signee can complete within minutes. 
  • Exclusive Control: Since the document can only be signed by entering the OTP, the signee has complete control over the validation process. 

Which Businesses Can Benefit From Using Digital Signatures?

  • Digital signatures offer a high level of security, making them desirable for large organizations. Such enterprises can ensure their documents and contracts remain untampered with the use of digital electronic signatures that are encrypted.
  • IT-based companies and those with high-security requirements can benefit from implementing digital document signing for their documents.
  • Securities and wealth management firms can utilize digital signature online to secure and create audit trails for high-volume transactions.

OTP eSign: Which Businesses Is It Suitable For?

  • OTP Based eSignatures are suitable for firms that require a quick and convenient solution for managing their workflow processes. Retail businesses and FMCG firms can benefit from using this form of online document signing.
  • The HR department can utilize the OTP eSign process to streamline and accelerate employee onboarding procedures.
  • OTP eSign can also be useful for completing banking money transfers, insurance policy transactions, as well as for e-commerce transactions. 


Every business is obliged to generate documents for its operations, which can include client agreements, employee documents, client or employee contracts, and loan agreements. In addition to generating these documents, it is essential to validate them legally using signatures from the required parties.

Online document signing acts as a convenient method that businesses can adopt in order to accelerate their contract closures. Digital signatures and OTP-based eSigns are legally valid in India and are an effective way for businesses to carry out their document validation workflow.

Online eSignature creators like SignDesk can help businesses streamline their document validation procedures with smart signature solutions. Using them, you can generate Aadhaar eSign or eSign online to quickly have documents or contracts signed from any place your client/customer may be in and complete the workflow process within no time.

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