The shift from traditional transactions to electronic transactions is taking place strongly in Vietnam and globally, especially in the context of digital transformation being considered a core strategy of enterprises and state agencies. In that trend, digital signatures have become an inevitable and indispensable factor to ensure the legality, security and efficiency of electronic transactions.
The following article by Bizzi will provide a comprehensive view of digital signatures, from the concept of what a digital signature is to its benefits and practical applications in the digital age.
What is a digital signature? Definition and nature
According to Clause 6, Article 3 of Decree 130/2018/ND-CP: “A digital signature is a form of electronic signature created by transforming a data message using an asymmetric cryptographic system, whereby a person having the original data message and the signer's public key can accurately determine. The above transformation is created using the correct secret key corresponding to the public key in the same key pair; The integrity of the content of the data message since the above transformation was performed”.
In addition, according to Clause 12, Article 3 of the Law on Electronic Transactions 2023: “A digital signature is an electronic signature that uses an asymmetric key algorithm, including a private key and a public key, in which the private key is used to sign and the public key is used to verify the digital signature. A digital signature ensures authenticity, integrity and non-repudiation but does not ensure the confidentiality of the data message.”
- What is the difference between electronic signature and digital signature?
- An electronic signature is a form of signature created in the form of words, letters, numbers, symbols, sounds, images, or other forms by electronic means, logically attached or combined with a data message to identify the owner of the data.
- Digital signature is a form of special of electronic signatures, created through an asymmetric cryptographic system and authenticated through a third party, a digital signature certification authority (CA).
- Relationship: Digital signature is a subset of electronic signature, has higher legal value due to CA certification.
What are the outstanding features of digital signature?
Digital signatures have 5 outstanding features, clearly shown in the electronic transaction process:
- Authenticity: Helps authenticate the identity of the owner of the digital signature through the digital certificate of individuals, organizations, and businesses.
- Security: Almost absolute security with 2 layers of security codes (secret key and public key), information is not easily stolen by hackers.
- Integrity: A document with a digital signature can only be opened by one person, the recipient of the document. All information in the document is guaranteed to be absolutely intact. Once the document is changed, the digital signature will be invalidated and no longer valid.
- Non-repudiation: When documents/papers/contracts have a digital signature, this digital signature cannot be replaced or deleted. One party to the transaction cannot deny that they have made a transaction with the other parties.
What is the relationship between digital signature and digital certificate?
Digital signature has value similar to a handwritten personal signature or a red seal of a company or organization. Meanwhile, Digital certificate It has the same value as CCCD or CMND on digital platforms, supporting the identity verification of the representative of the digital signature. A digital certificate is the basis for confirming whether a digital signature is valid or not; a digital signature is to confirm information for a document or commitment. Businesses or individuals who want to create a digital signature must first create a digital certificate.
What is the structure and operating mechanism of digital signature?
Digital signature is an electronic authentication technology that uses encryption to ensure the integrity, authenticity and non-repudiation of an electronic document. To understand better, let's go through two main parts:
- Structure: Digital signature is built on advanced cryptography to ensure authenticity, security and non-repudiation. It is established on the basis of RSA public key cryptography technology (asymmetric cryptography).
- Digital Certificate: Contains information about the owner, public key for signature verification, information about the CA issuing organization, issue date, expiration date.
- Encryption key pair: Includes a private key for the signer to encrypt the document when signing, and a public key shared with the recipient to decrypt and verify the signature. Only the owner has access to and use the private key.
- Hash Algorithm: Generate a unique cryptographic string for a document to ensure that the document cannot be tampered with or modified.
- Operating Model (Signing and Verification Process):
- Personal and organizational information is encrypted by hashing algorithms and uses key pairs for security.
- The signer uses the private key to create a digital signature on the document.
- The signature is stamped with the time the document was signed.
- The recipient uses the public key and digital certificate to verify and authenticate the digital signature, ensuring that the signature belongs to the sender and that the document has not been altered.
- If the document is changed, the digital signature will be invalidated.
Purpose and users of digital signatures
Below is a clear and complete summary of the purpose and users of digital signatures in businesses and individuals, especially in the context of increasingly popular electronic transactions:
- Intended use: Digital signatures are widely used and bring many benefits. Digital signatures are used for many different purposes to help work go faster and more smoothly.
- Declare, submit declarations, pay financial obligations in the fields of tax, customs and securities transactions.
- Carry out business registration procedures (registering business locations, establishing branches, representative offices, changing business registration).
- Sign contracts online with partners/customers.
- Online banking transactions.
- Sign internal documents.
- Authentication of legal documents.
- Declare social insurance online.
- Send and receive highly secure email.
- Register for a National Public Service Account.
- Target users: All individuals and organizations can use digital signatures.
- Digital signature for individuals/individuals belonging to organizations/enterprises: Used to declare and pay personal income tax, declare on the business registration page, sign labor contracts, sign internal electronic document confirmation, log into the security system, sign advance payment/receipt/payment vouchers, e-commerce transactions, e-banking, e-stocks.
- Digital signature for businesses and organizations: Used for tax declaration, tax payment, social insurance registration, customs tax declaration and payment, signing internal documents, signing reconciliation transactions, signing bank transfer transactions.
What is the legal value and regulations of digital signature?
Legal value and regulations on digital signatures In Vietnam, it is clearly stipulated in legal documents to ensure the authenticity, integrity and validity of electronic transactions.
- Is digital signature required?
- In fact, digital signature completely optional according to Clause 3, Article 26 of the Law on Enterprises 2020.
- However, there are 3 cases where businesses are required to use digital signatures: Tax declaration, submission of declarations and tax payment (Clause 10, Article 17 of the Law on Tax Administration 2019); Use of electronic invoices (Point b, Clause 7, Article 10 of Decree No. 123/2020/ND-CP); Online social insurance declaration (Article 4 of Decision No. 838/QD-BHXH).
- Conditions to ensure the security of digital signatures: According to Article 9 of Decree No. 130/2018/ND-CP, a digital signature is considered a secure electronic signature when it meets the following conditions:
- Created during the validity of the digital certificate and can be verified using the public key on that digital certificate.
- Created using a private key corresponding to the public key on the digital certificate and issued by one of the licensed organizations providing national, government, public, or agency/organizational digital signature certification services.
- The private key is controlled solely by the signer at the time of signing.
- Legal value of digital signature: Digital signatures are legally recognized when conducting transactions in the electronic environment. They have the same legal value as handwritten signatures or seals if they meet safety conditions.
- Form and display information of digital signature on electronic documents: (Refer to Circular 01/2019/TT-BNV applicable to state agencies, non-state individuals/enterprises can apply).
- For organizations and businesses: Red seal image, real size, .png format. Displays full name of business/organization/agency, signing time (date, month, year, hour, minute, second) according to Vietnam time zone ISO 8601 standard.
- For individuals: Handwritten signature image of the signer, blue, .png format. No signer information required, just display a valid signature image.
What are the outstanding benefits of using digital signatures?
Using digital signatures in businesses and organizations brings many outstanding benefits, especially in the current era of strong digital transformation. Below is a summary of the most important advantages of digital signatures:
- Save time, effort and cost: Reduce costs of printing, storing and transporting documents. Sign, send and receive documents quickly without having to meet in person. Reduce up to 80% of time and 85% of cost compared to traditional methods.
- Improve work performance: Automate the process of signing contracts, electronic invoices, tax declarations, and social insurance. Minimize paperwork, increase business productivity. Optimize the work schedule of CEOs and managers, allowing signing and approval anytime, anywhere.
- Ensuring information security and confidentiality: Forging a digital signature is virtually impossible. Ensures that only the recipient can open and read the signed document. Prevents signature impersonation.
- Comprehensive digital transformation support for businesses: Contribute to digitizing signing and transaction activities. Create a professional, modern and environmentally friendly working environment. Digital signature is clear evidence, against denial of responsibility.
- Support for identifying contract origin: Helps determine the time of signing and the subjects participating in the contract, ensuring the interests of each party in the dispute settlement process.
In short, registering and using digital signatures in a correct and safe manner will help businesses speed up legal procedures, reduce fraud risks, thereby optimizing operations and adapting to the digital transformation trend - paperless.
Popular types of digital signatures today
Digital signature is an indispensable tool in the context of strong digital transformation, bringing great benefits in terms of speed, cost, security and legality for all electronic transactions. Currently, there are 4 types of digital signatures classified according to storage method and security capabilities:
- USB Token Digital Signature: The most traditional and popular type of digital signature, stored on a USB device (Token). Requires plugging the USB into the computer to sign.
- Advantages: High security, easy to use, reasonable price, large storage, fast updates, high processing speed.
- Disadvantages: Must connect to computer, depends on Token, cannot decentralize users.
- HSM (Hardware Security Module) digital signature: Stored and operated on dedicated hardware (HSM). Allows mass digital signature, high security, centralized storage. Often used for large enterprises and banks.
- Advantages: Fast authentication, high legality, applicable to large number of signatures, flexible anytime, anywhere, high security, document integrity.
- Disadvantages: Difficult to control transaction flow, depends on account/OTP/username/password, has expiration date.
- SmartCard digital signature: Integrated on phone SIM. Allows digital signature on mobile anytime, anywhere.
- Disadvantages: Depends on SIM type and carrier coverage.
- Remote Signature: Based on cloud-based technology platform. No need for physical devices such as USB Token or HSM. Sign digitally anytime, anywhere on any electronic device (phone, laptop, tablet).
- Advantages: Fast and flexible signing speed, safe and legally guaranteed, hardware independent.
- Disadvantages: Requires stable network connection.
Registration process and notes when using digital signature
Below is the process of registering a digital signature and important notes when using a digital signature to ensure legality, safety and efficiency in business operations:
- Basic registration process:
- Step 1: Prepare documents: ID card/CCCD/Passport for individuals; Business registration certificate, tax code, legal representative information for businesses.
- Step 2: Choose a reputable digital signature certification service provider and create a registration request.
- Step 3: Submit application and verify information: Perform identity verification at the agency providing the service or via online channels.
- Step 4: Receive digital certificate and key pair, install device (if any).
- Step 5: Activate and use: Register an account with the relevant authorities (e.g. General Department of Taxation) to start using it.
- Important notes when using digital signatures:
- Choose a digital signature provider licensed by the State: Ensure digital signatures are legally valid and secure.
- Never reveal your secret key to anyone: The secret key is only under the control of the signer. Immediately notify the supplier of any risk of loss or leakage of information.
- Change default password: Default passwords are often easy to guess and should be changed to secure your account.
- Note periodic renewal: Digital signatures have an expiration date and need to be checked and renewed to avoid interruption.
- When losing USB Token or device containing digital signature: It is necessary to immediately notify the supplier to lock the digital certificate and reissue a new device.
- If you are the owner of the digital signature, you can remove the digital signature from the document.
Optimize financial and accounting processes with digital signatures and Bizzi solutions
Digital signatures are a key factor in ensuring the legality, integrity and security of electronic transactions, especially in financial and accounting processes, helping to effectively transform digitally. Integrating digital signatures into automation solutions helps businesses sign and authenticate documents quickly, minimize risks and increase operational efficiency.
Bizzi – AI Assistant for Finance and Accounting Department
As a platform integrating 30+ features to help businesses streamline and automate cost management, debt collection and B2B payment processes, Bizzi is a comprehensive cost control system for businesses.
- Reduce manual invoice processing time by up to 80%.
- Save up to 50% in personnel & operational costs related to accounts payable.
- Minimize risks and errors, increase accuracy and transparency of financial data.
- Improve productivity of accounting and finance department, promote digital transformation in business.
Digital signature is an indispensable component to ensure the legality and security of transactions automated by Bizzi. Bizzi's outstanding features in invoice processing include:
Invoice Processing Automation – IPA + 3-way matching
Bizzi Bot uses RPA (Robotic Process Automation) and AI technology to:
- Automatically download, read and check invoice information from multiple sources (email, system).
- Verify that the supplier information is valid.
- Warn of risks of incorrect, duplicate or unusual invoices.
- Automatically prepare data for approval and signing.
Automatically collect input invoices
- Provide separate invoice emails for each business.
- Download original PDF invoice from supplier, including:
- Full valid information.
- Display logo, digital signature, tax code clearly.
- Centralize all invoices on a single platform for processing, storage, and access.
Centralized electronic invoice management
Invoices are stored centrally and are easy to search by:
- Supplier
- Tax code
- Purchase Order (PO)
- Processing/Approval Status
Smart 3-way reconciliation (PO – Invoice – GR)
- 3D automatic comparison with accuracy > 99%:
- PO: Purchase Order
- Invoice: Invoice
- GR: Warehouse receipt
- Support for multiple reference structures:
- 1PO – 1INV – 1GR
- 1PO – nINV – nGR
- nPO – 1INV – nGR
- nPO – nINV – nGR
- Detect discrepancies, errors in unit price, quantity, discount... quickly
Automatically recognize and match information from invoices
- Automatically extract and recognize PO numbers from:
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- Invoice file attached
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- Contents on the invoice
- Reduce manual data entry and reconciliation time.
Strong integration with ERP/PMKT systems
- Synchronize invoice data with current accounting and financial software systems.
- Flexible customization to suit each internal process.
- Support extracting data to Excel in the correct format used by accounting software.
Conclude
The shift to electronic transactions is an irreversible trend. In particular, understanding what a digital signature is is the “key” to ensuring that all digital transactions are transparent, legal, fast and secure.
Which businesses should apply digital signatures and electronic management solutions as soon as possible? Bizzi, has a clear competitive advantage in the modern business environment. The application of digital signatures, especially when combined with comprehensive financial accounting management solutions such as Bizzi, will help businesses optimize operating processes, improve efficiency and ensure absolute safety in the digital environment.
To experience and get specific advice on the features of the solutions, make an appointment with Bizzi today!
- Link to register for a trial of Bizzi products: https://bizzi.vn/dang-ky-dung-thu/
- Schedule a demo: https://bizzi.vn/dat-lich-demo/
