5 Advantages That Make OTP a Brilliant Security Solution

5 Advantages That Make OTP a Brilliant Security Solution

18 September 2023

In today’s digital landscape, where cybersecurity threats are rampant, consumers are constantly looking for effective ways to enhance the protection of their accounts from unauthorised access.

While most consider two-factor authentication as a top choice for protection, they also value a seamless login experience whenever possible. Fortunately, one-time passwords (OTPs) offer a solution that combines security and convenience, benefiting both businesses and consumers.

To put it simply, OTPs are codes generated algorithmically, which businesses can send to customers attempting to log into their accounts. Typically comprising six digits, these codes serve as an additional layer of security alongside users’ primary login credentials, facilitating easy identity verification with the company.

OTPs also fall under the category of messages that can be sent via bulk SMS campaigns alongside alerts, marketing communications, and transactional messages. In this article, let’s examine the key advantages that make OTPs an excellent security measure.

How Does a One-Time Password Work?

Before delving into the advantages of one-time passwords (OTPs), let’s first understand how this security solution works. As previously explained, OTPs consist of automatically generated strings of numbers or characters that authenticate a user for a single transaction or login attempt. An algorithm creates a unique value for each OTP, taking into account contextual factors such as previous logins and time-based data.

When a user attempts to perform a transaction or access a system from an unauthenticated device, an authentication server works with an OTP generator using tokens to confirm the user’s identity. The OTP generator employs a hashed message authentication code (HMAC) algorithm to create a new random code for each access request. As the name suggests, all OTPs are usable only once, with the specific code being either time-based or hash-based.

The Advantages of One-Time Passwords

Now that you have an understanding of OTPs, you may be wondering whether they truly provide security and reliability. The succinct answer to that question is affirmative, as OTPs offer several ways to enhance security for businesses and consumers. Here are some of the key advantages:

1. Resistant to Replay Attacks

Using OTP authentication instead of static passwords alone has a distinct advantage. Unlike traditional passwords, OTPs are resistant to replay attacks, where hackers intercept and reuse data transmissions to gain unauthorised access. Once a user employs an OTP for access, the code becomes immediately invalid, preventing attackers from repurposing it.

2. Difficult to Guess

OTPs are typically generated using algorithms that incorporate randomness, making it improbable or challenging for attackers to guess and utilise them successfully.

Additionally, OTPs often have a limited validity period, may require knowledge of a previous OTP, or present users with a challenge (e.g., “Please enter the third and sixth digits”), further reducing the attack surface compared to password-only authentication.

3. Deters Identity Theft

Businesses using OTPs for user authentication make it considerably harder for attackers to breach employee or customer accounts and steal personal information.

For instance, if an unauthorised individual attempts to access another person’s account, the legitimate user will receive an unexpected OTP notification, alerting them to potential unauthorised access and enabling them to take prompt action to secure their account against identity theft.

4. Easy to Integrate

Another notable advantage of OTPs is their ease of integration into the authentication systems of businesses and organisations. While the cryptic nature of OTPs may make them challenging for users to memorise, IT security teams can readily deploy and distribute tokens, mobile apps, or other technologies to facilitate OTP usage.

5. Enhances User Experience

The trust customers have in a business is closely tied to the security of their accounts and data. Studies show that over 70% of consumers have a high level of trust when their accounts are secure. Therefore, businesses aim to avoid informing customers of data breaches.

OTPs enable businesses to provide robust security without burdensome authentication processes, offering quick and easy verification for a seamless user experience while ensuring security.


The numerous advantages of OTPs position them as an effective security solution against the growing threats of cybersecurity attacks, including phishing, ransomware, and identity theft. By implementing OTPs, businesses can offer customers a scalable, secure, and hassle-free authentication process, safeguarding sensitive data and fostering trust in their digital platforms.

Give your customers peace of mind by adding an extra layer of security through Moobicast’s One-Time Password (OTP) SMS service. As a trusted digital marketing provider, Moobicast assists countless users in securing sensitive data through a streamlined authentication process. With our service, your business can bolster web security effectively.

In addition to OTP SMS service, Moobicast offers top-tier SMS service marketing and WhatsApp marketing solutions to help businesses connect with their target audience and customers more efficiently. With the growing mobile usage, harnessing our WhatsApp and SMS marketing services can strengthen customer relationships and drive sales. Contact us today for more information on how we can enhance your security measures or digital marketing strategies.