Traditional password-based authentication mechanisms exhibit significant security vulnerabilities, prompting the adoption of Multi-Factor Authentication (MFA) to enhance user verification. However, current MFA methods, such as OffPAD, One-Time Password Tokens (OTT), and smartcard-based systems, remain vulnerable to attacks like Man-in-the-Middle (MITM), session hijacking, replay, phishing, and denial of service (DoS). Additionally, the conventional single-server authentication approach is inefficient and inadequate for modern security needs. This study introduces Secure Multi-Factor Authentication (SMFA), a novel framework designed to address these challenges by leveraging steganography for secure credential transmission, reducing susceptibility to MITM and session hijacking attacks. SMFA also incorporates an additional USB device as a supplementary authentication factor and employs a multi-server architecture to overcome the limitations of single-server models. A comprehensive analysis comparing SMFA to existing MFA protocols reveals its superior ability to counter MITM, replay, DoS, user impersonation, and password-guessing attacks. The results demonstrate that SMFA offers a robust and effective solution, addressing the weaknesses of both traditional password-based systems and current MFA methods.