Skip to content
Menu
Fintechngr
  • Home
  • Banking
  • Money transfer
  • Cryptocurrency
  • Real Estate/Property
  • Insurance
  • Tech
  • Start-ups
  • Loans
  • About us
  • Contact
Fintechngr
What does OTP mean in banking

What does OTP mean in banking?

Posted on October 15, 2022October 15, 2022 by admin

What does OTP mean in banking – If you are looking to understand the term “OTP” and its application in banking, this guide will give you ample idea of what existed on this topic.

What is an “OTP code?”

The term “OTP” means “One Time Password,” which also is an automatically generated numeric or alphanumeric string of characters that authenticates a user for a particular or single transaction /login session.

The OTP expires after a few minutes regardless if it’s being used to authenticate the transaction which it was generated for.

In essence, “OTP” is a security layer that provides additional safety/protection against theft and unauthorized access into an existing user account, be it in banking or otherwise.

Benefits of One Time Password (OTP)

1. The One Time Password becomes invalid in minutes, this prevents attackers from obtaining and using the secret codes and reusing them.

2. The OTP outweighs all the security hiccups the administrator or the security managers at the back-end team of the bank have to face.

3. Bad or weak passwords, sharing of credentials, password composition rules, or reuse of the same password on multiple accounts and systems are all redundant with the OTP-generated algorithm.

4. The breach of security is minimal given that OTP is only valid for a few minutes.

Illustration on What OTP Means in banking

Most Mobile banking apps and cards require an “OTP” to authenticate transactions.

Mr. Michael Ejike who happens to be a Polaris bank customer wants to transfer money from his Polaris experience to a third party, having keyed in the transfer he’ll be required to enter an “OTP” sent to his SMS SIM card linked to his bank account or email address whichever applies.

To add to it, there are instances where you wish to complete a payment in an online shop, the “OTP” is the most time required to complete such payments, here’s to ensure that whoever is consummating the transaction is the rightful owner of such credit/debit card being used.

The “OTP” is usually made of a 4-digit number, sometimes could be alphanumeric just as designed by the software that generates it.

It’s often referred to as a second-level authentication

Frequently asked questions on what does OTP mean in banking

Meaning of OTP in Face bank – OTP in the First bank is a string of codes automatically and instantly sent to your mobile number or email registered with your First bank MasterCard after you have started the transaction and entered your card details.

Meaning of OTP in GTBank – When transacting with at any of the participating merchant’s sites with your Naira or Dollar card/Visa or MasterCard, the one-time password is a 6-digit numeric code requested and can be obtained via SMS, Email, or GTBank hardware token.

Meaning of OTP in Zenith bank – For Zenith bank, you can as well as generate an e-Token app, a mobile application that generates one-time Passwords (OTPs) used in the authentication of electronic transactions.

The Zenith bank OTP is a series of characters that automatically authenticates the user for a single transaction or session, it is also an alternative to the Hardware Token.

Image credit: Istock

2 thoughts on “What does OTP mean in banking?”

  1. gafar says:
    April 12, 2023 at 10:28 pm

    send me transaction code

    Reply
  2. Olufemi tade fagbenro says:
    July 6, 2023 at 5:10 pm

    I will like to know of hard token.and how can I don online banking

    Reply

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Recent Posts

  • [Answered] How Do I get my Access Bank Account Number
  • How to Securely Block and Unblock Your Access Bank ATM Card
  • Is PiggyVest Approved by CBN? Unveiling the Regulatory Status
  • Apply for a Loan Without BVN in Nigeria: Top 10 Loan Apps
  • How to Check BVN without Airtime or Phone Number

Recent Comments

  • Mr. Junior on How to generate remita code for all payments
  • Daniel David on How to apply and receive Ecobank Xpress loan
  • Pius on How to generate and activate the Zenith bank token 
  • great_iqsl on How to calculate Treasury bill
  • Charle obiora nwoye on How to receive a loan with Fidelity bank loan code
©2025 Fintechngr | Powered by SuperbThemes & WordPress