If you need to share a document with an external third party, you should do so securely. Sometimes password protecting and emailing the document is not such a good idea (see Why you shouldn’t password protect your Office Documents). You might consider instead giving them temporary access to the folder itself (see How to share
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Perhaps you need to collaborate on documents, provide files for the external colleague to download, or even provide a location for them to upload files to your tenancy. If you need to share a folder with people outside of your organisation, you can do this securely with SharePoint.