Learn how to authenticate your transaction with OTP number.
Today, when you make an online credit card or debit card transaction, you typically receive an SMS from the bank containing a one-time password or OTP. OTP is a four or six digit number that you must enter (on your mobile or computer) to authenticate an online financial transaction. Today you cannot complete most financial transaction without OTPs. Also, banks sends OTPs in real time to provide an extra layer of security to your time-sensitive transactions. This article explains what OTP is, how it is generated by banks, and its importance.
A one-time password or OTP number is a unique security feature for online transactions. Typically comprising 4-6 digits, the OTP is an automatically generated numeric string of characters, which acts as a PIN to authenticate various banking transactions. Valid only for a single transaction or login session, an OTP provides an extra layer of authentication than a user-created static password.
Once you fill in your account details to pay for an online transaction, you get redirected to a page where you have to click on get ‘My OTP number’. At this stage, your bank sends you the instant OTP number via SMS on your registered mobile number. An OTP is valid for a few minutes, and you must enter it to complete the authentication process. If you do not receive the OTP instantly, you can click on resend OTP two more times.
Banks typically send OTP numbers via text message on your mobile device and your registered email address.
They may make a voice IVR call on your registered mobile number, wherein you will receive the OTP as a spoken password.
Some OTPs come as security tokens, which are microprocessor-based server smart cards or pocket-size key fobs. These cards produce a numeric or alphanumeric code to gain access to a transaction. This secret code changes every 30 or 60 seconds based on the configuration of the token.
With push notification authentication, you do not have to enter the OTP manually. The code is auto filled in the corresponding tab, and you can approve it with the click of a button.
The world is turning increasingly digital. Several websites and stores allow you to use conduct all kinds of online transactions. For such transactions, the OTP number plays a vital role in ensuring the authenticity and security of your financial transactions.
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*Disclaimer: This article is for information purposes only. We recommend you get in touch with your income tax advisor or CA for expert advice.