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If you are looking to have password/key based authentication along with AD authentication then it is supported via creating two separate servers one with password (AND/OR) key based authentication (https://docs.aws.amazon.com/transfer/latest/userguide/custom-identity-provider-users.html) and another one with AD (https://docs.aws.amazon.com/transfer/latest/userguide/directory-services-users.html)
answered 3 years ago
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thanks for confirming and providing documentation!