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I think the primary reason for the compatibility issue is that TransferSecurityPolicy-2024-01 deprecates the SHA-1 hash algorithm, which is used by the legacy ssh-rsa public key algorithm. Key Differences:
- TransferSecurityPolicy-2018-01: Supports legacy algorithms including ssh-rsa (SHA-1) and ssh-dss (DSA).
- TransferSecurityPolicy-2024-01: Strictly requires modern, secure algorithms. It disables ssh-rsa (SHA-1) and ssh-dss entirely.
Important Clarification on RSA:
The 2024-01 policy still supports RSA keys, but only when used with secure transport signatures: rsa-sha2-256 or rsa-sha2-512.
Why your clients are failing:
If your clients are using older SFTP software (e.g., outdated versions of WinSCP, FileZilla, or JSch), they likely only support the original ssh-rsa (SHA-1) signature scheme. Since the 2024 policy blocks SHA-1, the connection is rejected during the handshake.
I would try:
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Upgrade Clients: Ask users to update their SFTP clients. Modern versions will automatically use rsa-sha2-256 with their existing RSA keys.
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Use a Transition Policy: If you cannot update all clients immediately, consider TransferSecurityPolicy-2022-03. It provides a better security baseline than 2018 while maintaining broader compatibility.
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Legacy Support: If you must support legacy systems that cannot be updated, you will have to stick with 2018-01, but be aware that this may trigger warnings in security audits (e.g., SOC2 or PCI DSS) due to the use of SHA-1.
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- asked 2 years ago

It is important to mention that TransferSecurityPolicy-2018-01 should not be used and instead TransferSecurityPolicy-Restricted-2018-01 is the better choice for legacy systems. There are identical in all respects but the latter excludes the chacha20 algorithm which has known vulnerabilities.
Same reasoning applies to TransferSecurityPolicy-2020-06 and TransferSecurityPolicy-Restricted-2020-06.
Thanks for your answer but just want to verify if TransferSecurityPolicy-2022-03 will still be able to support ssh-rsa ?? as it was supported by TransferSecurityPolicy-2018-01.