As technology continues to advance, more and more businesses are turning to digital-based agreements as a way to streamline their operations. Many organizations have begun searching for the best ways to integrate this technology with existing processes.
In this article, we’ll explore the advantages of electronic contracts over paper contracts and explain why they are becoming increasingly popular for businesses worldwide.
What is an Electronic Contract?
An electronic contract is a legally binding agreement you can create and sign digitally rather than on paper. This type of contract typically leverages electronic signature software, which allows users to sign documents online, eliminating the need for physical signatures. Electronic contracts enable all parties to sign and access the document from anywhere with an internet connection.
Disadvantages of Paper Contracts
While paper contracts have been the traditional way of doing business for many years, they come with several disadvantages:
Paper contracts can take days or even weeks to be signed, mailed, and returned. This delay can be frustrating for businesses that need to move quickly and efficiently.
Paper-based contracts require printing, mailing, and storage, which can add up quickly. Additionally, businesses may need additional staff to manage their paper contracts.
Difficult to track
Physical contracts can be challenging to track and manage, especially if they are sent through the mail or require multiple signatures. This can lead to poor turnaround times for contract management.
Businesses operating with limited physical space may have trouble storing and managing physical contracts. For companies that deal with many agreements at a time, this can cause more problems than it’s worth.
Let’s face it. Physical contracts can be lost, damaged, or even forged. These issues can lead to disputes and legal headaches. Businesses that can’t afford to face trouble with the law may find that paper contracts aren’t the best option.
Negative environmental impact
Of course, paper-based contracts require resources such as paper, ink, and other finite resources. The continuous use of these goods can significantly impact the environment in many negative ways.
Advantages of Electronic Contracts
Helps save time
Electronic signatures can be signed and returned almost instantly, which speeds up the contract management process considerably. Many organizations find that the time savings from using electronic contracts help them put more resources into other business functions.
Fewer associated costs
By using electronic contracts, businesses can reduce the costs associated with signing, printing, mailing, and storing paper contracts. Eliminating paper, ink, and other physical resources help companies decrease expenses and boost profits.
Many eSignature apps offer cloud-based storage solutions, making accessing documents easier than physical storage. Some apps even provide military-grade encryption for all records stored in the cloud.
Contrary to how some may perceive them, electronic contracts are legally binding in most major jurisdictions, including the United States. Specific laws, such as the UETA and the E-Sign Act, make this legality possible.
At least when compared to paper-based contracts, electronic agreements can be friendlier on the environment. By reducing the need for paper, electronic contracts can help businesses reduce their environmental impact and consequently help the world.
Why Electronic Contracts are Becoming Increasingly Popular
Given these advantages, it’s no surprise that electronic contracts are becoming increasingly popular among businesses of all sizes. In fact, according to a recent study, the eSignature market is expected to grow by over 30% between 2021 and 2026.
One of the main reasons for this growth is the increasing adoption of cloud-based technology, which has made it easier and more affordable for businesses to implement eSignature software. In addition, the COVID-19 pandemic has accelerated the adoption of eSignatures, as companies have had to adapt to remote working and online transactions.
Electronic contracts offer numerous benefits over paper contracts, including increased efficiency, accuracy, security, and cost savings. As businesses continue to move towards digital processes, digital contracts are becoming a favored and essential tool for online businesses.
With eSignature software like Fill, organizations can streamline their contract management and focus on what matters most: growing their business.
Use Fill for Managing Electronic Contracts Effortlessly
With highly sought-after security features like 256-bit end-to-end encryption and signer ID verification, you can be sure that Fill protects your documents at all costs.
Try Fill and choose electronic contracts over paper contracts today. Get started for free now.