Expert in Microsoft Dynamics (Vendor Collaboration B2B)

We have a new implementation of microsoft dynamics - and part of the installation is to implement a vondor collaboration module. (B2B). The issue here that we implemented dynamics on premise not cloud SaaS. so microsoft azure active directory is not invloved and can't be invloded since dynamics and B2B are installed on premise. In order to allow external users login to the collaboration B2B portal the implementer requested create account for each external user in our local active directory. and that is not secured solution. I need to know if any one is expert here and can provide a workaround solution to allow external users to use on premise B2B without creating username in our active directory