What Is Two-Factor Authentication? Is It Useful?

As connectivity grows -- whether in personal life or in the workplace -- so do the demands on security. Opening business systems to the outside world introduces new risks, and the rise of digital processes means individuals often share more about themselves than they intend to. Effective measures and secure software are essential to prevent unauthorized access. One proven solution is two-factor authentication.

What Is Two-Factor Authentication?

Two-factor authentication (2FA for short) is an IT security measure that uses two independent components to secure access to networks or applications. 2FA makes identity verification considerably more robust. Germany's BSI (Federal Office for Information Security) recommends the routine use of two-factor authentication for IT services in its IT-Grundschutz catalogues.

How Two-Factor Authentication Works

With two-factor authentication -- also called two-step verification -- the user needs two different keys. The first is usually a password, set by the user as usual. The second key is ideally not a password. In practice, several options exist. One of the most widely known is the mTAN procedure familiar from online banking: when logging in to a site or approving a transaction, a one-time code is sent via SMS (or sometimes through an app) that must be entered as an additional step. This code can only be used once and is valid for a short time window only. The second key can also be a biometric feature such as facial recognition or a fingerprint on your smartphone. However, these methods should not be used for highly sensitive data such as online brokerage accounts, since it cannot be ruled out that your fingerprints could fall into the wrong hands.

Another option is hardware keys. Users receive a physical key in the form of a smart card, USB dongle, or radio transmitter that can be used with a compatible reader or the smartphone's NFC reader. Due to the high acquisition costs, this option is mainly suited to larger companies and public authorities rather than personal use. A somewhat more secure and less costly alternative is the security token -- a dedicated device that generates one-time passwords. Compared to ordinary smartphones, security tokens offer several advantages: no third-party apps are installed on them that could gain permission to read SMS messages. The token method is therefore especially widespread in professional environments. For more information, see the article "Back to basics: Multi-factor authentication (MFA)" from NIST.

Why the Method Makes Sense

Even though one-hundred-percent security for your data and accounts is never achievable, two-factor authentication is still well worth implementing. It adds another layer to the identification process that unauthorized individuals must overcome first. The extra effort this requires is often disproportionate to the potential gain for attackers. Phishing attacks in particular are thwarted by this safeguard, since they rely on tricking users into revealing passwords and PINs through forged emails. Even if recipients fall for the deception and hand over their credentials, attackers still lack the second key -- such as a fingerprint or an mTAN code. The most common online threat scenarios for identity theft can be effectively prevented by 2FA. That said, it is important to consider where the procedure is truly necessary. For access to Spotify, two-step verification would be overkill, but for online banking it is a different matter entirely. There, 2FA provides a quickly implemented layer of protection against potentially severe damage. Your email account, as well as your Google and iCloud accounts containing personal information, should also benefit from this additional security. Kaspersky has compiled a useful list of advantages and disadvantages.

Conclusion

Two-factor authentication is not merely sensible -- it is essential, and will continue to establish itself as a standard IT security measure in the years ahead. Of course, 2FA alone will not be enough to fend off targeted attacks on applications and data. However, the same is true of most security measures: every procedure can have vulnerabilities, which is why layering multiple safeguards at different levels is always advisable.