When do passkeys improve security but still leave governance gaps?

Passkeys improve security when they replace reusable secrets, but governance gaps remain if fallback authentication, recovery, or exception handling still relies on passwords or OTPs. If those paths remain open, the organisation may have improved the primary login but left the real control boundary unchanged.

Why This Matters for Security Teams

Passkeys usually raise the bar because they remove reusable passwords from the primary login path, but security teams often stop the analysis too early. Governance risk remains wherever the organisation still allows password reset, OTP fallback, helpdesk exception handling, or recovery workflows that can be abused to reintroduce weaker factors. That means the control boundary has not really moved, even if the user experience has.

This is a familiar pattern in NHI governance as well: the weakest path, not the strongest one, defines the real security posture. NHIMG research on lifecycle and audit controls shows why identity assurance has to be measured across the whole process, not just at the point of authentication, and NIST Cybersecurity Framework 2.0 reinforces that access governance must cover protective controls, recovery, and ongoing oversight, not only sign-in strength. The practical question is whether passkeys eliminate the fallback paths that attackers actually target.

In practice, many security teams discover the remaining weakness only after recovery abuse or exception handling has already been used to bypass the intended control.

How It Works in Practice

Passkeys improve security when they are enforced as the normal and preferred authenticator, but they only fully change governance when the organisation also closes the legacy paths around them. That means reviewing every place where an identity can still be verified, recovered, or escalated. If password-based recovery still exists, the account remains recoverable through a weaker control even if day-to-day login is stronger.

A practical implementation usually includes:

• Removing password fallback where business rules allow it, rather than leaving it as a hidden exception.
• Hardening recovery with identity proofing, step-up checks, and time-bound approval for sensitive changes.
• Logging and reviewing all fallback use so exception paths are visible to security and audit teams.
• Treating recovery, support, and admin override workflows as part of identity governance, not separate service desk issues.

That approach aligns with the lifecycle view in Ultimate Guide to NHIs — Lifecycle Processes for Managing NHIs, because the relevant question is not only how an identity authenticates, but how it is created, recovered, rotated, and retired. It also reflects the control emphasis in NIST Cybersecurity Framework 2.0, where governance is evaluated across the full risk lifecycle.

For organisations that still run mixed authentication, passkeys should be treated as a control uplift, not a control completion. The gap is governance, because a stronger primary factor does not automatically remove weak exceptions from the operating model. These controls tend to break down when legacy support desks retain recovery privileges for high-volume user resets because the exception path becomes the easiest path for abuse.

Common Variations and Edge Cases

Tighter authentication often increases operational friction, requiring organisations to balance user convenience against recovery risk. That tradeoff is especially visible in regulated environments, shared-device scenarios, and B2B portals where administrators insist on multiple fallback routes.

Best practice is evolving, but current guidance suggests that any exception to passkey-only access should be treated as a deliberate governance decision with explicit approval, expiry, and monitoring. If an organisation permits OTP as a backup, that may be acceptable for some user populations, but it should not be assumed to deliver the same assurance as passkeys. There is no universal standard for when fallback should be removed entirely; the decision depends on threat model, fraud tolerance, and support capacity.

Audit and risk teams should look for three common edge cases: dormant accounts that can still be recovered through older channels, privileged users with broader recovery rights than standard users, and third-party integrations that still authenticate with passwords or shared secrets. The Top 10 NHI Issues resource is useful here because the same governance failure shows up whenever an organisation improves one credential path but leaves another path with weaker oversight. For control mapping and audit evidence, Ultimate Guide to NHIs — Regulatory and Audit Perspectives helps frame what reviewers expect to see.

Passkeys improve security, but governance only catches up when the organisation can prove that fallback routes are reduced, monitored, and removed where feasible.

Related resources from NHI Mgmt Group

• What is the difference between role-based access and API key governance for NHI security?
• How should security teams use IAST and RASP in NHI governance?
• Why is single-provider AI agent governance not enough for enterprise security?
• How should security teams use AI red teaming results in production governance?