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OTP Meaning in Text, Email, Online Bank – What does OTP Mean in Actual

OTP is a single use password that is used for user authentication. This post will discuss about what is One Time Password, OTP meaning in Text, Email and Online Bank, types, how it is generated, how it works, applications, advantages and disadvantages.

What does OTP Mean | OTP Meaning

OTP stands for One Time Password or One Time Pin. Authentication using OTP is very common in our daily life. When you try to login to any payment related application, it requires “One Time Password” Entry. Some applications or websites use it as confirmation for transactions.

Introduction to OTP

Fig. 1 – Introduction to One Time Password

It authenticates the user for a single login attempt. It is very important in the process of verifying the identity of user. It adds a second layer of security in the verification process. OTP generally comprises a string of numbers or characters. A backend algorithm is in place that generates a unique string of numbers each time, taking time-based data and contextual information into account. No two One Time Password’s are similar.

OTP (One Time Password)

Fig. 2 – OneTimePassword Verification and Authentication

OTP (One Time Password) Types

There are two types of One Time Password’s. They are:

  • Software One Time Password
  • Hardware One Time Password

Software OTP

It is a One Time Pin (Password) generated by the mobile applications and sent to your mobile as SMS or email. It is event based One Time Password i.e. it requires trigger to generate it. Here the trigger is the User. The user has to request for OTP to be sent on his mobile phone. Examples of One Time Password (Software) include: Payment related applications – One Time Pin is generated when user tries to enter credit/ debit card details while online shopping.

Hardware OTP

Hardware Pin or password is generated by a physical device (hardware device/ token). It is a time based OTP i.e. values are obtained for a short period of time. It might change to a new value even before the user could enter his password/ pin. Examples of One Time Password (hardware) include: Banks provide security token for online banking, many companies provide hardware token/ key to login to their secured network.

Hardware OTP (One Time Password)

Fig. 3 – Hardware OTP

OTP Meaning in Text Message| What does OTP Stand for 

You must have received the One Time Passwords for various login attempts and for making transactions at some point. It is the one-time password auto generated on request by an individual. As a security measure against the rising instances of cybercrime, many companies have made OTPs necessary.

OTP Meaning in SMS

Fig. 4 – OTP Meaning in Text Message

You would receive a set of 4-6 numbers as SMS (Text Message) on your mobile phone that you need to add in the designated place for One Time Password on the portal, app, or website to move ahead. Some apps and websites have it in place as a two-factor security system for login.

OTP Meaning in Email

You would receive One Time Passwords on email at times, the purpose of which is the same as that received via SMS. However, the format of the email One Time Pin will be slightly different from that of the SMS. Email OTP is sent for retrieving passwords and web authentication of bank accounts.

Email OTP (One Time Password)

Fig. 4 – OTP Meaning in Email

How is OTP Generated

OTPs are generated using mathematical algorithms or Random Number Generation methods within the systems. Every time a user tries to log in, they receive OTP on their registered mobile number or Email ID. This One Time Password is generated based on the exact moment of generating, and other contextual information.

This OTP is unique and has to be used in the space given in the app or on the web portal. Once that happens, the user can log in. It is like a two-step security process. Most of the time, these OT Passwords are time-based and expires after a few minutes. In that situation, you would have to regenerate the One Time Pin again from the option available.

How OTP (One Time Password) Works

One Time Password authentication works on the principle of request and response method. The User provides login details in the application. “OTP generate” request is raised to MAG (Managed Access Gateway).

MAG generates One Time Pin and stores the User details in the Database for Validation purposes. The generated One Time Password is sent as SMS to the User on his mobile. The user copies and enters the same in the valid field.

MAG OTP Policy compares the user entered One Time Password with the one it has generated and stored in the Database. If it is valid, User is given access to the protected Application Programming Interface else the access is denied.

Working Principle of One Time Pin

Fig. 5 – Request and Response Principle of OneTimePassword Generation

Applications of One Time Password

The applications of OTPs are in the following fields:

  • OTP can be used for securing payments.
  • Some companies use it as a confirmation for transactions.
  • For securing documents online.
  • For delivery of retaining products such as Amazon products to your doorstep.
  • As bank portal authentication.
  • To set and reset passwords.
  • If you get locked out of your accounts, OTPs to registered mobile numbers or Email IDs can help you log in.
  • Allowing the connection of multiple devices with one account.

Advantages of One Time Password

Some of the advantages of OTP are listed below:

  • Two-factor authentication is possible. It allows the users to keep their information secure online.
  • It prevents frauds. The OTPs are known to prevent online scammers from getting access to your account.
  • It gives you complete control over your accounts and accesses.

Disadvantages of One Time Password

Some disadvantages are:

  • If someone has access to your registered Email ID and phone, they can access your accounts with the OTP received on them.
  • OTPs are generally time-sensitive, and you have to use them within a small window.
Also Read:
What is CAPTCHA Code - How it works, Design, Types, Applications
Common Gateway Interface (CGI) - How it Works, Features & Applications
Advantages and Applications of 4G Phone Network Technology
Suchetana Dutta
Suchetana Dutta
Suchetana is a Healthcare professional with Masters in Pharmaceutical Science. She has 2+ years experience in the Health-tech industry.



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