GrinMark products rely on Exchange Web Services API (EWS) to access Exchange mailbox data. More and more customers start switching to two-step authentication and as a result synchronization stops working. User credentials which worked previously lead to an ‘Unauthorized’ response from Exchange.

Microsoft created ‘Application Passwords’ to resolve this problem:

https://support.microsoft.com/en-gb/help/12409/microsoft-account-app-passwords-two-step-verification

Microsoft says:
“After you’ve turned on two-step verification, some apps (like the mail apps on some phones) or devices (like an Xbox 360 or Windows Phone 8) will show an incorrect password error because they can’t prompt you to enter a security code when you try to sign in. The solution to this problem is to create app passwords to use in place of your regular password, but only for these apps that don’t support two-step verification. App passwords are long, randomly generated passwords that you only have to provide once.”
What should I do:

Generate an application password and use it with your GrinMark synchronization solution. It will work for individual users as well as for accounts which use impersonation to access other mailboxes.