Oct 13, 2020
Legaltech and the future of legal services
Legaltech has completely remodelled the legal sector. The use of technology and innovation to digitize and rethink certain sectors from a professional perspective is something that has been on everyone’s lips since the birth of the “Fintech” term, which describes the use of new technological tools to reinvent and transform financial and banking areas.
Legal services offer is wide and adapts to the needs of companies, including those actions dedicated to the regulatory aspect associated with online and digital activities. That is why Regtech arises as a concept closely related to Legaltech and with which it is often confused, although they hold key substantial differences.
Legaltech, compound by the words “Legal” and “Technology”, brings together activities and companies focused on implementing the latest technological solutions to the legal services sector.
Although we can already talk about Legaltech since the end of the 70s, thanks to the introduction of terminals such as UBIQ for the telematic checking of jurisprudence, the term has begun to be used strongly as of 2008, with the rise and consolidation of companies’ digital transformation in all areas.
The development of ad hoc technological solutions adapted to the legal sector and law services promoted the use and recognition of the Legaltech term. These solutions range from the digitization and optimization of industry-standard processes and operations to the birth and conception of new disruptive legal services previously impractical given past technical limitations.
Therefore, when we talk about Legaltech, we are referring to companies and solutions that provide technical support to the legal sector to reinvent itself, innovate and optimize its operations. That is why Legaltech should not be confused with legal areas such as digital law.
Legaltech and its close relationship with Regtech
Fintech, Proptech, Insurtech, Govtech, Legaltech, Regtech … The emergence of specialized areas focused on the digitization of various sectors of activity has led to the creation of different ecosystems with a common highlight: technology as the central axis. And, as many sectors of activity are interrelated and merge with each other, the terms that define their digitization processes and activities are interlinked as well.
Regtech and Legaltech have gone hand in hand since both terms were coined. However, their approach is disparate. While Legaltech corresponds to the use of technology for services in the legal sector, Regtech initiatives and companies focus on the reinvention and digitization of processes so that they comply with the regulations that affect them.
Regtech provides companies in any sector with technological solutions to rethink and digitize their processes in such a way that these ones, thanks to their new way of doing business based on digital methods, strictly comply with the current legislation that affects them. Regtech focuses on legal, compliance, IT, operations and sometimes commercial departments of companies from any industry.
Among the companies that must be more rigorous with regulatory compliance in relation to their activities and operations, financial and banking areas stands out. Hence, on many occasions, Fintech and Regtech terms are also mixed and sometimes are confused.
Legaltech, on the other hand, revolves around professionals from the legal sector, law and consulting firms, etc; who obtain disruptive tools to develop new legal services, optimize their usual activities and digitize their business thanks to the use of new technologies.
The role of digital identification in Legaltech
One of the keys in the legal sector is identity verification. The verification and corroboration of the legal identity of a natural or legal person is essential with for procedures associated with the provision of legal services.
Thanks to Legaltech, companies and law firms in the sector can offer legal services entirely online. To verify the identity and know with assurance and security the client with whom they are going to work, they must perform KYC (Know Your Customer) process.
KYC process, widely used in sectors where sensitive operations are carried out, such as finance, banking and insurance, represents the solution for the legal sector to operate online with guarantees and security. Thanks to eKYC (electronic Know Your Customer) and video identification digital solutions, it can be established a secure framework for the telematic provision of legal services.
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For the business and organizational verification in online B2B operations in the legal sector, the has been established the KYB (Know Your Business) process, which holds eKYC practices to legitimize inter-organizational telematic relationships.
One of the most common processes in the legal industry is the one related to the signing process. A signature, as proof of identity and intention, is used as a legitimate means to ensure or authenticate the identity of a person and as proof of consent, accreditation, acceptance, integrity and legal approval.
Electronic signature, therefore, plays a vital role, being one of the most widely used digital identification methods for Legaltech operations and activities. Simple, advanced or qualified, the electronic signature is subject to its use and models around eIDAS (electronic IDentification, Authentication and trust Services) regulatory standard and the AML5 framework.
eID, an expert partner in technology and legislation
eID, with extensive experience within the Regtech area, has been accompanying various areas, including legal, in their digital transformation processes and their products and services reinvention.
Thanks to its innovative commitment to digital services associated with verification and legitimation of online identity, Electronic IDentification has promoted the development of areas such as Govtech and reinvented telematic user-organization relationships.
Contact eID through this form and request a demonstration of our Legaltech solutions adapted to the legal sector.