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Entra External ID vs Azure AD B2C

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Entra External ID vs Azure AD B2C

Microsoft has two products for customer identity. Here's the difference and which to pick today.

Solving Microsoft 365 · www.solvingmicrosoft365.com/guides/entra-external-id-vs-b2c

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01

Azure AD B2C

B2C works, but its UX is dated, its policy authoring (custom policies) is famously painful, and it's separate from the rest of Entra.

Solving Microsoft 365 · www.solvingmicrosoft365.com/guides/entra-external-id-vs-b2c

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02

Microsoft Entra External ID

External ID also has the older workforce flavour that lets you bring guests into your existing workforce tenant — that's the same B2B story.

Solving Microsoft 365 · www.solvingmicrosoft365.com/guides/entra-external-id-vs-b2c

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03

Cost model

Both products price by monthly active users (MAU): the first N MAU per month are free, with tiered pricing above that. The free tier is generous for early-stage apps.

Solving Microsoft 365 · www.solvingmicrosoft365.com/guides/entra-external-id-vs-b2c

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04

What External ID still lacks

If your app needs deep customisation that B2C custom policies provide today, check carefully — some advanced scenarios (complex token issuance, REST API steps in the flow, sophisticated user attribute manipulation) are…

Solving Microsoft 365 · www.solvingmicrosoft365.com/guides/entra-external-id-vs-b2c

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05

Why this is a separate product from workforce Entra ID at all

It's a common early question: why can't customer sign-ups just use the same Entra ID tenant that manages employees? The answer is isolation and scale — a customer-facing identity system needs to handle self-service sign…

Solving Microsoft 365 · www.solvingmicrosoft365.com/guides/entra-external-id-vs-b2c

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