Touch ID intermittently stops working

Just to provide an update on this, I contacted Apple Support and this case has been escalated to a Senior Advisor and the Engineering Team. we held a screen share session to demonstrate the problem in action. We removed all registered finger prints from Touch ID, and since then, I have not been able to add a new finger print. The finger print enrolment process instantly fails before even attempting to let you enrol a new fingerprint! The problem was not isolated to an individual user profile either. All of the test user profiles I created demonstrated the same problem.

Diagnostics data had been gathered about my system to support the engineering team's investigation, as an initial clean installation as per the Apple support article (https://support.apple.com/en-gb/guide/mac-help/mchlp1599/mac) did not fix this.

I took it a step further when performing a second reinstall of macOS. I deleted all volumes on the SSD, rather than just the 'Macintosh HD - data' volume the support article instructions (above) detailed. After this clean installation of macOS, the issue appears to now be resolved, however it was not all plain sailing... during the macOS setup process, Apple Pay setup would not work, however, after an hour or so, I was able to activate it on the MacBook Pro through system Preferences.

Based on this feedback with the Engineering teams, there may be a need to update the support article when it comes to wiping the internal storage volume for reinstallation of macOS. In doing this, it's given them something else to look into!

Thank you for the advice, unfortunately the problem still persists even after an SMC reset or NVRAM / PRAM reset.

Resetting the SMC on a second occasion appears to have resolved the problem. Thank you for your support leroydouglas!

Eugh... looks like it only temporarily fixes the issue, it's rearing it's head again! It's got to be something wrong with Catalina. I might roll back to the original macOS my MacBook Pro came with...