Microsoft has made it official: beginning November 1, 2025, Microsoft Dynamics 365 Finance and Supply Chain Management (F&SCM) users without proper licenses will be locked out of the system. Microsoft is enforcing stricter license compliance moving forward, which means no more honor system and no more overages without consequences!

Source: Microsoft
This change marks the end of a leniency period, during which customers could use more user licenses than they had officially purchased.
If your organization is non-compliant, you might experience service disruptions, penalties, or both. Additionally, you won’t be able to add new users without the required licenses, potentially impacting operations and limiting business continuity.
This change has huge implications for organizations relying on Dynamics 365 F&SCM to run financial operations, supply chains, procurement, inventory, etc.
Our blog serves as a comprehensive guide to help you understand the Microsoft D365 F&SCM license enforcement in 2025, prepare your organization for compliance, avoid non-compliance risks, and take steps to prevent unnecessary licensing costs.
What’s changing and when?
Until now, Microsoft has allowed customers to exceed their licensed user count in Dynamics 365 F&SCM. That will no longer be the case. Starting:
- April 30, 2025 – License usage reports available: Organizations will begin reviewing detailed license usage reports in Lifecycle Services (LCS) to identify users without valid licenses and prepare for upcoming enforcement.
- September 1, 2025 – Soft enforcement begins: Also known as a “soft block,” this phase introduces in-app warning banners for users without valid licenses, alerting them to the issue without restricting access.
- November 1, 2025 – Full enforcement starts: Referred to as a “hard block,” this phase will deny platform access to any users who are not properly licensed.
This includes all Dynamics 365 Finance and Supply Chain Management apps (Finance, Supply Chain Management, Commerce, Project Operations, and HR).