Okta does not currently support the concept of service principals (feature request! @Okta 😊) Service Principals are a better way to manage application permissions, see examples from Microsoft: https://learn.microsoft.com/en-us/entra/architecture/secure-service-accounts#service-principals.
In Okta service accounts refer to accounts created to perform actions on behalf of an application’s API, a common use case is to create, update and deactivate users in an application external to Okta. Service accounts are created by a human, the credentials must be stored and managed and an Okta license is dedicated to each service account.
This guide aims to provide clarification on use cases for service accounts in Okta and Applications connecting to Okta.
If service accounts are not used, this creates issues and risks within your Okta tenant:
If API connections are broken in SCIM, a reconciliation exercise must be done between Okta and target apps when the connection is re-authorized, Okta performs Create/Update/Deactivate actions based on event triggers (e.g. user leaves organization) and will not retrospectively update users in the target app. This means a user can be DEACTIVATED in Okta, but their account is ACTIVE in the target app.
About The Author
Lynsey Dunn is an IAM Consultant and Certified Okta Consultant at Distology Studios, bringing extensive Risk Analyst experience from previous positions at Deutsche Bank and Morgan Stanley.