Digital Signature
Importance of Digital Signature in E-commerce
A Digital Signature is a verified and authentic signature that guarantees that the contents of a message have not been altered in any way. It uses a mathematical algorithm to validate the authenticity and integrity of digital messages. For instance, an email, a credit card transaction, or documents.
Digital signatures are most commonly used for software distribution, financial transactions, contract management software, and also to detect whether the signature is verified or fake. It is also often used to implement an electronic signature. Many of us might get confused here, but yes, digital signatures and electronic signatures are not the same. To help you understand the difference between the two, please read our extensive blog titled “Difference between Electronic Signature and Digital Signature”.
What is Digital Signature in e-Commerce?
In the field of e-Commerce, digital signatures help to ensure the security of online transactions and help in building the trust of buyers and sellers. It also helps in providing evidence to validate the authenticity of any transaction, digital document or message.
E-commerce spaces basically deal in buying and selling products online, and hence records of any transactions involved in it are stored in a digital format. Installing a digital signature software helps to speed up the process of sharing invoices, receipts or any other transaction-related documents.
How does Digital Signatures work in an e-Commerce space?
The prime reason that e-Commerce spaces should trust digital signatures is that it provides complete security during any kind of online transaction. The process is actually a three-stage phenomenon which can be defined as follows:
1. Key Generation Algorithm In this stage, a private key is generated using an advanced mathematical algorithm.
2. Signing Algorithm In this stage, the document to be signed is generated. Though this stage is called the signing algorithm, you cannot sign the document until your signature has been verified.
3. Verification Algorithm In this third and the final stage, the system verifies the authenticity of the private key and the message, and then generates two keys, namely the private key and the public key.
After you’ve passed these three stages, you enter a process of authentication which checks whether your private key matches the public key. You can only sign the document, once both the keys match. This shows that in the field of e-commerce, where numerous transactions take place between anonymous identities, the security of digital signatures ensures that only verified transactions have taken place.
Importance of Digital Signatures in e-Commerce
As the space of e-Commerce has opened various avenues where we meet many unknown people and hack unforeseen opportunities, it has also brought with it the disadvantage of cyber fraud. Digital Signature in e-Commerce ensures that the parties involved in the transaction are authorized to complete it and are not cybercriminals. It is inevitable that any type of business be it B2B, B2C, C2B, or C2C have extensively started believing and using digital signatures in order to safeguard the authenticity and confidentiality of online transactions. It ensures that the transaction is safe for both the buyer and the seller.
Advantages of using Digital Signatures in e-Commerce
- Secured Data Sharing : Various methods like Public Key Infrastructure (PKI), hash functions, cryptography, and encryptions are used to verify the authenticity of digital signatures thus making them safe and secure for use in your e-commerce dealings.
- Time & Cost Saving : Signing and transporting of physical documents usually are time consuming and incurs additional expenses in cases where the physical document needs to be sent by courier to some other location. In the case of digital documents, they can be signed from anywhere at any time and be sent to its destination within a fraction of a second via the internet.
- Elevated User Experience : With the advent of technology and the modern society becoming much more familiar to technology, digital signatures are very convenient, faster, secure and hassle-free in the process of signing documents.
- Secured Online Transactions : A digital signature is authorized and verified by the means of multiple authentication methods, thus ensuring that the persons involved in any kind of transactions are authentic and that the transaction happening is safe and secure.
- Simplifies B2B Contracts/Agreements : The contracts or agreements between B2B e-Commerce parties are detailed and technical which requires the entire teams involved to be onboard. This can consume a lot of time if done physically, especially when both parties belong to different geographical regions. This is when digital signatures come to action, saving time and expenses and making life simpler for the parties in contract.
- Legal Validation : Digital signatures are both authentic and legally accepted. They can easily be tracked with time stamps and presented in case of arguments. It is very hard to challenge digital signatures in courts unlike physical ones.
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