How to Choose a Password Manager for Your Business

Somewhere in your business there is a spreadsheet, sticky note or group chat full of shared passwords. The social media login. The supplier portal. The Wi-Fi password. The bank’s admin account that 3 people know. It works until someone leaves, a laptop is stolen or one of those passwords turns up in a breach.

A business password manager replaces that mess with encrypted vaults, controlled sharing and an admin console. CISA’s Secure Our World guidance recommends using a password manager to create long, random and unique passwords, because remembering a strong unique password for every account is not realistic.

The hard part is choosing one. Most products look similar on a pricing page. This guide gives you a feature checklist that separates the ones built for teams from the ones that are really personal tools with a business label.

Personal vs business password managers

A personal password manager protects one person’s logins. A business password manager adds 3 things you need as soon as more than 1 person touches company accounts:

• Central ownership. The company, not the employee, owns the vaults that hold company credentials.
• Controlled sharing. You decide who sees which passwords, and you can change that in seconds.
• Admin visibility. You can enforce policies, see who has access and remove someone without asking them for anything.

If you are new to how the encryption and autofill work, start with our explainer on how password managers work.

The security architecture checklist

Start here, because features cannot make up for weak foundations.

End-to-end, zero-knowledge encryption. Vault data should be encrypted and decrypted on the user’s device, with keys derived from something only the user has, such as their account password or a device-held key. The vendor should not be able to read your vault. Look for a public security white paper that explains this in detail.

Strong key derivation. The master password is turned into an encryption key using a deliberately slow function such as PBKDF2 or Argon2. Slower derivation makes stolen vaults much harder to crack offline.

Know what is not encrypted. This is the lesson of the 2022 LastPass incident. In its official notice, LastPass said an attacker copied a backup of customer vault data. Usernames, passwords and notes were encrypted with 256-bit AES, but website URLs were stored unencrypted. Ask every vendor exactly which fields, including URLs and item names, are encrypted.

Independent testing. Look for recent third-party penetration tests, a bug bounty program and recognized attestations such as SOC 2 Type II or ISO/IEC 27001. If you are building your own compliance program, our SOC 2 compliance guide explains what those reports cover.

Breach transparency. Check how the vendor has handled past incidents: how quickly it disclosed, how specific it was and what it changed.

Key takeaway: Ask every vendor 3 questions in writing: Can you read our vault data? Which fields are not encrypted? When was your last independent security test? Vague answers are a warning sign.

Sharing and admin controls

Sharing and vault structure

This is where business tools earn their keep. Check for:

• Shared vaults or collections organized by team, client or function, such as “Marketing,” “Finance” and “Client A.”
• Granular permissions. At minimum: view only, edit, and manage. Better tools let you share a login so someone can use it without seeing the password.
• Group-based access tied to teams, so adding someone to “Finance” gives them the finance vault automatically.
• Secure external sharing with an expiring link for contractors or clients, instead of pasting passwords into email.
• Separation of personal and company items. Many business plans give employees a private vault. Make sure your policy is clear about what happens to it when they leave.

Admin controls and policies

Your admin console should let you set rules once and apply them to everyone.

• Password policies for vault access, plus MFA enforcement for every user. Our guide to multi-factor authentication types explains which methods are strongest.
• Device and session controls, such as timeouts, blocking unmanaged devices or restricting sign-in by location.
• Role-based admin rights, so the office manager can add users without seeing the finance vault.
• Security reports that flag weak, reused or exposed passwords across the company.
• Audit logs that show who viewed, edited or shared which items and when. These are vital after an incident.

Account recovery: the feature people forget

Zero-knowledge encryption means the vendor cannot reset a forgotten master password and give you access. That is good for security, but it means you need a recovery plan.

Check how each product handles:

• Admin-assisted recovery. Can a designated admin help an employee regain access without being able to read their vault?
• Recovery for admins. What happens if the only admin is locked out? You want at least 2 admins.
• Emergency access. Can the business recover company vaults if an owner is unavailable?
• Recovery kits or keys, and where they should be stored.

Test recovery during your trial. A recovery process you have never tried is a guess.

Integrations: SSO, provisioning and passkeys

Integrations decide how much manual admin work you will do every month.

• Single sign-on. Many business plans let employees open the password manager with their company login through your identity provider. Read our guide to single sign-on to see how that fits together.
• Directory provisioning (SCIM). Automatically creates accounts for new hires and suspends leavers when you change them in Microsoft Entra ID, Google Workspace, Okta or similar. Vendor docs often treat SSO and provisioning as 2 separate integrations, so check you are getting both.
• Passkey support. The ability to store and sync passkeys, not just passwords, will matter more each year. See what passkeys are for background.
• Platform coverage. Browser extensions for the browsers your team uses, plus desktop and mobile apps for Windows, macOS, iOS and Android.
• Other tools. Secrets management for developers, SIEM log export or a command-line tool may matter if you have technical staff.

Feature checklist at a glance

Use this table to score each product you shortlist.

How pricing usually works

Business password managers are almost always priced per user per month, usually billed annually. Expect tiers: a basic team plan with shared vaults and core admin features, and a higher business or enterprise plan that adds SSO, SCIM provisioning, advanced policies and reporting. Some vendors offer family accounts for employees as a perk.

Prices vary and change often, so compare current vendor pages. When you do, price the tier that includes the integrations you actually need, not the cheapest one on the page. Paying for SSO and provisioning may be cheaper than the staff time spent adding and removing users by hand.

How to choose and roll out in 6 steps

1. List what you share. Inventory shared accounts, who uses them and which are most sensitive, such as banking, payroll, domain registrar and admin consoles.
2. Shortlist 2 or 3 products that meet every “must have” in the table above. Well-known options include 1Password, Bitwarden, Keeper and Dashlane; compare them on your checklist, not on reviews.
3. Run a 2-week pilot with a mix of people, including your least technical colleague. Test sharing, mobile autofill, recovery and offboarding.
4. Design your vault structure before importing anything. Fewer, clearly named vaults are easier to manage.
5. Migrate and clean up. Import from browsers and spreadsheets, then delete the old copies. Change the most sensitive shared passwords as you move them.
6. Write a short policy: what goes in the company vault, MFA requirements, and what happens on a person’s last day. Our employee offboarding IT security checklist covers that last step.

Conclusion

The right business password manager is the one your team will actually use, built on encryption the vendor cannot read, with sharing and admin controls that match how you work. Score each option against the checklist, test recovery and offboarding during the trial, and pay for the integrations that save you admin time. Then retire the spreadsheet for good.

Sources

• CISA: Use Strong Passwords (Secure Our World) — recommendation to use a password manager for long, random, unique passwords
• LastPass: Notice of recent security incident — which vault fields were encrypted or unencrypted in the 2022 incident
• NIST SP 800-63B-4: Authentication and Authenticator Management — guidance that verifiers should allow password managers and autofill
• 1Password Support: Automated provisioning with SCIM — example of SSO and SCIM provisioning as separate business integrations