The California Department of Motor Vehicles now supports an end-to-end digital sales process, removing wet-ink barriers that prevented fully online transactions in the state.
The change, announced earlier this month, allows digital signatures on all vehicle contracts sent to the department. Those documents can even be signed on a cellphone.
The DMV has allowed digital signatures for odometer disclosures since September 2019, when NHTSA updated its regulations. Automotive dealerships in the state are optimistic about the change, according to Brian Maas, president of the California New Car Dealers Association.
Maas said his team has worked closely with the department for the past two years on eliminating wet-ink barriers. Pandemic-related disruptions at the dealership level prompted the state department to move even faster on a digital process, he said, which included record retention and digital signatures.
“What really helped move things along is some of the first-line service providers, the people the dealers use and who have relationships with the DMV, really started to innovate here,” Maas said.
Ensuring the security of electronic documents slowed the state’s adoption of the vendors used by car dealerships, Maas said. California software and service company Vitu was the first to be approved by the DMV for digital signatures, he said. Vitu supports title and registration services in all 50 states and works with thousands of dealerships. Founded in 2005, the company was previously known as Motor Vehicle Software Corp.
Vitu CEO Don Armstrong said in a separate statement the company facilitated its first fully paperless transaction in California on March 24.
“By working with the California DMV, CNCDA and adhering to NHTSA requirements, we have implemented a simpler, faster and cost-effective service for those preferring to engage in a complete digital experience,” Armstrong said. “We are looking forward to rolling this service out nationally.”
Vitu differentiates a digital signature from an electronic one, according to a company spokesman. Since the technology verifies the user as part of its process, it has a higher tier of security and fraud prevention, as defined by government standards.
California DMV Director Steve Gordon said in a statement the department took advantage of updated technology and federal rules to move to a paperless process.
“The DMV is in the midst of a major digital transformation to reduce paper and provide more services online,” Gordon said. “Enabling fully digital vehicle sales and titling securely online is the latest way we’re improving DMV customer service.”