Website not Accepting Windows Hello PIN Passkey anymore

I don't know if this is the correct question to ask on this thread section but let me know.

I had created a Windows Hello PIN passkey through my bank's security portal section and it worked fine for a couple of days or so and now when I sign in and use the Passkey to sign in using my Windows Hello PIN its asking to send an SMS code again even I created a Windows Hello passkey.

I can still see the entry for my bank's passkey from the Windows Settings Accounts and Passkey section but why is it still asking to send an SMS code again?

I tend to make a habit of deleting all cache files and history data from the Edge browser for every banking session that I do just to be safe and secure, would that wipe the Passkey file as well? But like I mentioned, it is still there as an entry under Accounts and Passkeys.

Or, is it something from my bank's end that they had changed recently?

I can still see this Passkey from here (see image)

The public key of the passkey is what would be stored on the bank side, that shouldn't be in browser cache but rather in a datastore on the banks end. You should be able to confirm from your online bank account whether or not the passkey is still available. You also may need to switch your default auth factor from your bank profile.

I think this now a normal thing. It's 2FA aka MFA. I've seen it often.

If you see your bank account's information in the "Accounts > Passkey" list, then the passkey information needed to authenticate with the bank is still with Windows Hello. The fact that the bank is accepting the authentication means they have your passkey's public information on their side as well.

The fact that the bank still requires you to supply an OTP from your SMS either means the bank suddenly requires or has always required SMS OTP for you to log in. There are other websites that allow you to log in with a passkey but still require another 2FA, including Adobe. This is not common, but it does happen, depending on the site. Do you remember ever using the option like "remember me/this computer" on the SMS OTP request from the bank in the past? This would explain why you might not have noticed it before.

Passkeys can also be "attested" for trustworthiness, with a security key being more trustworthy, and a platform/password manager passkey being less. You could try using a security key's passkey for your bank to see if they would allow you to log in without the SMS OTP.