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OTP vs Passwords

Last Updated : 23 Jul, 2025

The OTP and Passwords are one of the key components when it comes to authentication. In this world of computers these are one of the most important things is security. In this article, we will learn about OTP and Passwords and the Difference between these two.

What is a Password?

Password is a sequence of characters that is used to verify the identity of a user. It is typically set by the user itself. A password can include letters, numbers, and special characters. A password can be modified by the user, if he/she forgets it by some another authentication method. Passwords are stored in the database in forms of hashed format. and It checked against user input during login attempts.

Use Cases

  • It is ideally used for the system where ease of use and quick access are priorities.
  • It is suitable for low to moderate security requirements where users can reliably manage their passwords.

Characteristics

  • It remains the same until the user can not modify it.
  • It can be set by some set of rules such as, it must be 8 chars long, should contain special characters etc.
  • It is vulnerable to attacks such as brute force, dictionary attacks, and phishing.
  • It may can be easily predictable.

What is OTP?

OTP stands for One Time Password. It is a temporary codes generated for a single use for login session. It sent by the SMS or the Email of user. when user enters the login credentials, the backend sends the OTP to the user's by Email or SMS. basically it works as a extra security layer. It can be used only once and expires after some times.

Use Cases

  • It is preferable for the applications, where high security is required. Ex: banking application, Ticket Booking systems, UPI Applications etc.
  • It is commonly used for multi-factor authentication (MFA) setups to add an additional layer of security.

Characteristics

  • It can be re-send by the user.
  • It expires after some time.
  • It only can be used once.
  • It is generated by the system.

Difference Between OTP and Password

OTP

Password

It is dynamic in nature, as it is each time uniquely generated by system.

It is static in nature, It remains same until user does not change.

It is generated by system.

It is chosen by the user.

It is resistant to replay attacks and phishing

It is vulnerable to brute force, dictionary attacks, phishing

It does not need to be memorized.

It need to be memorized.

It requires additional operations for OTP generation and delivery.

It is each to implement.

It can be slower due to additional step in authentication.

It is easy to use and quickly accessible.

It is temporary, It expires after use or a short duration

It does not expires, It is permanent until user changes.

It is preferable for the applications, where high security is preferable.

It is preferable for the application, where are low to moderate security requirements.

Conclusion

In conclusion, Password and OTP plays an important role in user authentication. Password is a simple and easy to implement but it is also vulnerable, especially when users choose weak passwords or reuse them across multiple sites. Other side, OTPs are more secure because every time it dynamically gets generated and expires after use or some time but it is difficult to implement because of additional steps. We can use Password with OTP verification to add additional layer of security to our application.

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