If you have integrations with Dynamics 365 you can create a non-interactive user account.  This is a free licence type which can be used for integrating with Dynamics 365 but cannot access the UI.

To configure this you need to give the user a D365 licence, set them as “Non-Interactive” in D365 and then remove the licence.

1. Give the user a licence in the Office 365/PowerApps Portal  (Sometimes the user takes a few minutes to sync)
2. Log into Dynamics 365
3. Navigate to Advanced Settings -> Security -> Users
4. Open the user’s record, scroll to the bottom of the page/select the Administration Tab and change the user’s Access Mode to “Non-Interactive”

You should then be able to remove the Dynamics licence from the account in the Office 365/PowerApps Portal.

More information at https://docs.microsoft.com/en-gb/power-platform/admin/create-users-assign-online-security-roles#create-a-non-interactive-user-account

 

There is a limit of 5 non-interactive user licences per instance.

Update 17/3/2021:  This limit appears to have been increased to 7 users. We tested in a demo tenant and when trying to add an 8th non-interactive user received the following error:

“Your organization has reached its maximum number of non-interactive users. To mark this account as non-interactive, mark another user account as interactive or deactivate a user account.”