Despite the rise in account-based cyber attacks, user passwords remain remarkably easy to crack. A recent survey from Bitwarden revealed that 25% of people reuse passwords across 11-20+ accounts. What’s worse — 19% of respondents use “password” as their password. Clearly, businesses can’t rely on users to set passwords with the strength to prevent costly, reputation-damaging data breaches.
Two-factor authentication (2FA) is a user-friendly, easily accessible way to strengthen account security. However, many businesses resist adding 2FA due to concerns about convenience, initial setup costs, resource allocation, ongoing maintenance, and implementation complexity .
The importance of 2FA in protecting user identities and safeguarding your business’s reputation can’t be overlooked. This guide will seek to overcome some of the chief objections to adding 2FA and demonstrate why this protocol is a natural solution for businesses of all sizes.
What is two-factor authentication (2FA)?
Two-factor authentication is a security process that requires two different methods of identification to verify a user's identity.
Unlike traditional authentication, which solely relies on a password, two-factor authentication incorporates a second factor, such as biometrics or a security token like a one-time password (OTP). By requiring users to verify their identity with two different factors, 2FA adds a security layer to existing systems.
Incorporating a separate, unconnected authentication channel into your product’s authentication process makes it difficult for malicious actors to compromise secure systems.
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Why is two-factor authentication used?
There are two reasons to use 2FA.
- First and foremost, cybersecurity threats have been increasing in recent years. More than 8 million data records were breached in the fourth quarter of 2024; the US has the highest average breach cost globally, at $9.48 million. In addition, Verizon found that “over 80% of breaches within hacking involve brute force or the use of lost or stolen credentials.”
- Data breaches are increasingly prevalent — and increasingly expensive. Yet, many businesses still feel under equipped to protect their accounts. WEF’s Global Cybersecurity Outlook Report 2024 found that 81% of leaders feel more exposed or similarly exposed to cybercrime than last year.
The combination of a higher threat profile and pervasive poor password habits make 2FA a critical solution for modern businesses.
Is 2FA worth it?
In short: yes.
For businesses hesitant to adopt 2FA, Jacob Kalvo, the Founder of Live Proxies and a cybersecurity expert with over a decade of experience shares,
“Implementing 2FA has smoothed out much of our internal security processes, making them safer for our team and users. This has resulted in increased user trust and reduced unauthorized access attempts. The additional security and peace of mind easily compensate for the initial difficulties in integrating 2FA.”
Two-factor authentication vs. passwords
The table below provides a quick overview of the differences between traditional authentication and two-factor authentication.
What are authentication factors?
A user can be authenticated in multiple ways. The three most used authentication factors are:
Knowledge factor
It's something the user knows, like a password, a personal identification number (PIN), or another shared secret.
Knowledge factors include:
- PINs
- Passwords
- Security questions with answers only known to users
Possession factor
It's something a user has, such as an ID card, a mobile, or a laptop to approve authentication.
Possession factors include:
- Authenticator apps such as Microsoft authenticator, Authy, etc. create time-based OTPs
- SMS OTP sent to the user's mobile device via text message
- Hardware tokens that generate secure codes like Yubikeys, or SecuID
- Physical cards (smart cards) that can be inserted into a card reader for authentication
- OTPs or verification links are sent to the user's email address
Inherence factor
It's something a user is, typically a biological characteristic. Inheritance factors include:
- Fingerprints
- Retina scans
- Voice recognition
- Facial scans
There are additional factors that don’t fall neatly under these three categories. You can verify users' identity depending on their geographical location, for example, or limit authentication attempts to certain times of the day.
Two-factor authentication combines any two types of factors. The most common combination is knowledge + possession factors, wherein a user enters their password and authenticates via an OTP sent to their mobile phone.
Choose a combination that best suits your users' account security needs. You can even choose multiple factors to enable multi-factor authentication (MFA) for more robust account security.
How does two-factor authentication work?
The typical two-factor authentication workflow includes these steps:
- Login prompt: The user is prompted to log into the app or website.
- Enter user credentials: The user is asked to enter their credentials, typically a username and a password (something they know).
- Factor verification: The system verifies the credentials.
- Second-factor prompt: The user is prompted to input the second login factor (typically an OTP sent to their registered mobile phone).
- Input OTP: The user enters a one-time passcode generated during the previous step.
- OTP verification: The system verifies the OTP.
- Access granted: The user will gain access to the website or application after providing both factors
Common types of 2FA verification
Hardware tokens for 2FA
Hardware tokens are USB keys, and smart cards, that generate unique authentication codes.
Some companies use devices like YubiKey or Google Titan Security Key to improve account security. These devices are plugged into a USB port or use NFC to authenticate users even when trusted devices are offline. Smart cards require a card reader and generate a one-time password or authentication when inserted into the reader.
SMS text-message and voice-based 2FA
With SMS-based 2FA verification, after entering the password, the user receives a code on their phone, which they enter into the website or application to complete the login process.
Voice-based 2FA follows the same process, but via phone call.The user speaks a specific phrase or password, which is then analyzed and matched to their voiceprint. Although it’s vulnerable to voice snooping, it's a secure, and hands-free option. You can easily make bulk calls globally by following the best practices for voice calling.
Software tokens for 2FA
These tokens generate an OTP used in two-factor authentication. The typical workflow from a user’s perspective for 2FA through software tokens includes these steps:
- Install authenticator app: User installs an authenticator app such as Authy, Google, or Microsoft authenticator on their app.
- Enable 2FA: User visits the account security setting of the application they want to secure and enables 2FA.
- QR scan: User opens the authenticator app on their device and scans the QR code.
- Generate OTP: The authenticator app's QR code containing a secret key starts generating OTPs based on that key.
- Enter OTP: User reads the current OTP on the authenticator app and enters it into the website.
- OTP verification: The application checks the submitted OTP against the expected OTP and ensures it hasn’t expired based on the timestamp saved during OTP generation.
- Handle OTP verification failure: In case OTP verification fails, the app notifies the user, generates a new OTP and asks the user to re-enter it.
Push notifications for 2FA verification
Push notifications are sent to the registered user's mobile device for approval. The user simply taps "approve" on their device to complete the authentication process.
Other forms of two-factor authentication
Apart from the types of two-factor authentication mentioned above, a few additional ones include:
QR code-based authentication
A mobile device scans a QR code to authenticate the user. For example, Google Authenticator, and WhatsApp Web use QR codes to authenticate users.
Location-based authentication
Users are authenticated based on their usual IP address or geographic location.
Risk-based authentication
Depending on the user’s risk level, the system prompts for additional authentication factors or helps establish a risk score.
FIDO (Fast Identity Online) protocols
These are a set of protocols that enable passwordless authentication using smartphones or security keys. For authentication requests, for instance, Facebook, Twitter, etc. have enabled FIDO protocols for users to log in with security keys.
Two-factor authentication for mobile devices
Apple iOS, Google Android, and Windows 10 all have apps that support two-factor authentication. The user’s mobile phone itself serves as the physical authentication device.
For example, modern devices feature an in-built camera for facial or retina scans, leveraging biometric authentication as a security measure. Some devices equipped with GPS add an extra security layer by verifying users based on their location.
Authenticator apps like Google Authenticator have now replaced traditional methods like sending verification codes from a trusted phone. These apps generate a six-digit every 30 seconds removing the need to wait to even receive verification codes in a text.
Note: If you’re already a Plivo user, follow these steps to implement 2FA in seconds.
Is two-factor authentication secure?
Two-factor authentication is more secure than simple password authentication, but it’s not foolproof.
Despite implementing two-factor authentication, companies like Twitter, Zoom, Coinbase, GitHub, and Reddit, have experienced data breaches. The Reddit data breach in 2018 highlighted vulnerabilities in SMS-based two factor authentication, prompting a move towards a more secure authentication method.
Why SMS-based authentication falls short
NIST’s Special Publication 800-63-3 (National Institute of Standards and Technology) discourages the usage of SMS as it’s susceptible to interception and prone to phishing attacks, SIM swapping, and brute force attacks.
To mitigate these vulnerabilities, industry experts recommend:
- Conducting regular audits and testing
- Adherence to industry standards and best practices for implementing two factor authentication
- Adopting more secure authentication methods such as biometrics, or hardware security tokens
The future of authentication
Environments needing higher security benefit from multi-factor authentication involving more than two authentication methods. Likewise, the future of authentication lies in using passwordless methods, using biometric data, hardware tokens, and OTPs to authenticate users.
Early adopters are using passkeys to provide a secure alternative to 2FA. Passkey technology relies on a pair of generated keys: the private key resides on the user's device, and the public key is transmitted to the service. This process eliminates the need for users to remember passwords altogether.
Companies are using behavioral data that identifies the user's keystroke length, typing speed, and mouse movements to complete real-time authentication. Adaptive authentication and decentralized identity (blockchain-based) authentication are also rising.
How can Plivo help
Although 2FA is relatively simple, challenges can arise during implementation, such as failed delivery or sending OTPs to invalid phone numbers. This is where a reliable solution such as Plivo’s Verify API comes in. We offer infrastructure that handles high-volume SMS and voice, with strong fallback mechanisms.
Plivo offers robust voice and messaging integration for your applications while reducing SMS spend. Our comprehensive 2FA API supports SMS and voice-based delivery that generates, sends, and verifies OTPs efficiently while allowing extensive customization of OTP and verification messages.
Further, we use intelligent routing to optimize message delivery paths, enhancing the overall cost-efficiency of your messaging operations.
How Plivo enhances 2FA
Key features of Plivo’s Verify API
- No authentication fees - only SMS and Voice charges apply
- Get pre-registered phone numbers - no costs on number purchasing or renting
- No extra costs for regulatory compliance - we take care that the frequency of messages, time of messaging, etc. comply with international guidelines
- Our API integrates easily with your existing security systems
- We provide solid fallback mechanism in case of failed SMS deliveries
- OTPs are delivered even during high-traffic periods
To implement 2FA with Plivo, request a trial account.
Benefits of using Plivo’s Verify API
High conversion rates that minimize SMS spend
Plivo secures your communications with 10DLC registered numbers and strict compliance with GDPR, HIPAA, and ISO 27001 standards, ensuring data protection. Plivo guarantees reliable delivery and minimizes the risk of message errors or interception by sending dynamic verification codes exclusively to approved verified phone numbers.
Jungleworks, a leading software solutions provider noted a 9% increase in deliverability after switching to Plivo.
Global compliance to avoid penalties
Plivo maintains pre-approved, country-specific phone numbers, ensuring compliance with local telecommunications laws for businesses operating in multiple regions.
With Plivo, CallHub, a leading communications platform, navigated thousands of different networks, and carriers, placing nine million calls in one election cycle.
High international delivery rates to minimize message volume
You need a provider that ensures higher conversion rates. Plivo's extensive global coverage across 220+ countries and territories achieves this by minimizing the number of messages sent. We offer competitive advantages such as priority onboarding, test credits, premium routes for messages and calls, and expedited carrier registrations, providing more value for your investment.
Built-in Fraud Shield for protection against high-risk profiles
Plivo’s Verify API offers Fraud Shield for free. It significantly reduces frauds by verifying users, and defending businesses against SMS pumping. This solution protects against high-risk outbound calls, swiftly identifies unusual traffic patterns, and lets you customize your security measures with ease.
Flexible pricing model to maximize cost savings
Plivo offers a free trial followed by a pay-as-you-go pricing model. You can explore our comprehensive communication features, including, voice, SMS, and 2FA, without any upfront commitment. If you’re looking to scale, get volume pricing to maximize cost savings.
Strong fallback mechanism for guaranteed delivery
Plivo ensures your messages reach their destination despite network issues or invalid numbers with its strong fallback mechanism. We monitor messaging patterns, set country-specific thresholds, and automatically send voice messages if SMS delivery fails.
Easy implementation with a step-by-step guide
Implementing Plivo’s API is straightforward with detailed documentation covering setup, application usage, and code verification.
These authentication and fraud prevention methods not only secure your users’ accounts but also foster trust with your customer base.
