You’ve probably heard about the iPhone 5s’ new fingerprint reader, which the company is calling Touch ID. It can be used to unlock your device, authenticate purchases from the iTunes Store and possibly more. Being of a legal mind, I found myself wondering whether an iPhone 5s user could use Touch ID to replace conventional signatures and conclude contracts too?

Before I answer that question, it’s worth recapping the reasons why we contract the way we do.

It might surprise you to learn that a written document isn’t required for most contract types (contracts for property sales, wills and one or two others have to be in writing by law), capturing the terms of your agreement in writing is an excellent practice because it ensures greater certainty about what everyone has agreed to and can be used as a reference if there are subsequent disputes. Assuming you have a written contract, the practice has been for the signatories to the contract to meet, sign the document together and sometimes – more often in South Africa than other countries – have those signatures witnessed.

If you unpack this practice, there is quite a bit happening beneath the seemingly mundane surface.

When the signatories meet to sign the document, they are implicitly authenticating themselves to each other so they can be sure the right person is signing the contract. If the contract contains all the terms they have agreed on, they can take comfort that what they are signing accurately reflects the many aspects of their agreement, even if some of that tends to be “boilerplate” and, yet, remains pretty important.

Their actual signatures on the document visually verify the signatories’ agreement to the terms and conditions in the contract. That verification can be referenced later should there ever be a question whether a signatory concluded that contract.

It sounds obvious but when you start thinking about digital contracts, it is important to think about how to introduce these authentication, signature and verification elements into the digital contract process.

The starting point in South Africa is the Electronic Communications and Transactions Act which essentially introduced parity between paper-based documents and digital documents. This is an important and essential step for conducting business online.

But when you take contracts into a digital space you often lose the implicit benefits of signatories meeting in person to sign a document they agree on. For example, how do you know that the person handling the device that is used to sign a digital contract is who she says she is? The next challenge is how the signatories can sign a digital contract with verifiable signatures that reliably authenticate the signatories? The two questions sound the same but one person could hypothetically access a device and sign a contract, impersonating another. The ECT Act also deals with what a so-called “electronic signature” is, which is important to know because it establishes a broad set of criteria that a digital signature applied using the iPhone will have to satisfy to have legal effect.

Ideally a Touch ID-based signature should be backed up by a certificate issued by a trusted certificate authority who has verified the iPhone user’s identity (the equivalent of checking a person’s ID document when you meet with them to sign your paper contract). That would add a layer of authentication which confirms everyone is who they say they are.

Short of that, an iPhone user can still validly sign contracts but it will have the equivalent level of authentication as you would have if you email a digital contract to someone who returns it to you with a simple graphical signature applied and never know for sure if your intended recipient actually signed the document. This isn’t all that different to how most contracts are signed but there is potential for even more certainty if further steps are taken.

Touch ID offers an interesting opportunity to provide a level of authentication for contracting parties while, at the same time, giving the iPhone owner a convenient way to conclude contracts simply by touching the fingerprint reader to sign the contract. One challenge, however, is taht the iPhone’s relatively small form factor which could make reviewing contracts somewhat tedious but imagine Touch ID on an iPad and you have a platform that can soon replace paper documents and ink pens.