Big companies like Twitter, PayPal, and Apple are continuously advising us to better secure our data and accounts with multi-factor authentication methods that replace the usual username and password routine. OTP (One-Time Password) via SMS is probably the most commonly used since many businesses started utilizing it before other authentication methods like apps and tokens became popular.
Nowadays, online web apps are asking their users to protect their accounts with an extra layer of security and they do so by setting up 2-factor authentication through TOTP (the Time-based One-Time Password algorithm).
What is SMS OTP?
An OTP SMS solution is an authentication method that uses one-time passwords sent to a user’s mobile phone number via SMS to authenticate them for a single transaction or session. It is used to prevent unauthorized access to a user’s account or system.
How Does SMS Authentication Work?
SMS authentication is a two-step process that requires you to provide a one-time code sent via text message to verify your identity. This code is typically sent to your mobile phone and must be entered into the system or website to complete the authentication process.
During the process, your phone number is verified to ensure it belongs to whoever is attempting to access your account or a website with your details. SMS authentication is often used as a security measure in online banking, e-commerce sites, and other sensitive applications.
Today, SMS OTP has become the standard for confirming user identity as they just need their phones and don’t have to install any app or hold hardware tokens.
Advantages of SMS Authentication
- Easy to set up: SMS authentication is one of the easiest authentication methods to set up. All that is needed is a mobile phone and an SMS gateway provided by a communications platform as a service (CPaaS) provider.
- Increased security: SMS adds an extra layer of security to user accounts as it requires the user to enter a one-time password sent to their mobile phone.
- Cost effective: SMS authentication is much cheaper than other authentication methods such as biometric authentication.
- Convenient: SMS authentication is convenient for users as they don’t have to remember complex passwords or carry around authentication tokens.
- Widely available: SMS authentication is available in many countries and is supported by most mobile phone networks.
Is SMS authentication secure?
With hackers growing more sophisticated every day, SMS continues to be a secure platform and when used properly, it requires users to provide both something they know (their password or PIN) and something they have (their phone) to access an account.
Additionally, SMS authentication codes can be made unique and time-limited, which makes them more secure than static passwords.
Furthermore, SMS messages can be encrypted to protect them from interception, which helps to further secure the authentication process. However, SMS authentication is not foolproof, as it can be vulnerable to SIM-swapping attacks and other types of fraud.
Are There Any Risks?
While being very convenient and simple to set up and use, there are some risks and here are some risks you should keep in mind:
- SIM swapping: Hackers have found ways to intercept SMS messages and they can contact a phone company using your personal information they have collected like your SSN to request that your number be transferred to another phone. This gives them access to any code sent to your phone number without your knowledge.
- SIM hacking: Malicious actors are known to spoof cell phone tower signals and SS7 systems to peer into people’s private data.
- Online account takeover: Wireless service providers often grant their users to check their text messages through web portals and if their accounts are not secured with 2FA, fraudsters can gain access and monitor them for authentication codes.
SMS OTP is gaining a lot of ground and more businesses are implementing it to protect their users from data leaks.
If you’re looking to make your accounts and that of your customer more secure you should consider integrating SMS OTP into your system and BSG can help you get started today.
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