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One-Time Password

Definition: A One-Time Password (OTP) is a password that is valid for only one login session or transaction, used in a multi-factor or two-factor authentication system. This temporary password is typically sent to a user's mobile device or generated by an authenticator app.

In the field of cyber security, OTPs provide an additional layer of security beyond traditional static passwords. Because OTPs change with each login attempt or transaction, they offer protection against replay attacks, where an attacker may try to use a previously intercepted password. The dynamic nature of an OTP means it reduces the time frame within which an intercepted or reused password is valid, thereby enhancing the security of online services.

OTPs are commonly used for securing access to sensitive systems, online services, and financial transactions, where having a robust authentication process is crucial. They can be delivered via SMS, email, voice calls, or generated by dedicated hardware or software-based token devices or applications.

Key Characteristics:

  • Temporary: OTPs are designed for a single use and become invalid after the session or transaction.
  • Dynamic: They change with every login or transaction, offering no useful information to potential interceptors for future unauthorized access.
  • Time-Sensitive: Many OTPs are configured to expire after a short period to minimise the risk of being exploited.
  • Supplemental Security: OTPs are used in addition to traditional passwords to provide a second factor of authentication.


  • Real-World Example: A user is logging into their online banking platform. After entering their password, they receive an SMS with an OTP which they must enter to complete the authentication process.
  • Hypothetical Scenario: An individual tries to conduct a financial transaction through their banking app. To validate the transaction, the app requires the user to enter an OTP, which is generated and displayed on their security token device.

Related Terms:

  • Two-Factor Authentication (2FA): A security process that requires two authentication methods, often including an OTP as one of the factors.
  • Authenticator App: A mobile application that generates OTPs for use in a two-factor or multi-factor authentication process.
  • SMS Authentication: A form of two-factor authentication where an OTP is sent to the user’s mobile phone via text message.

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