I was facing the same issue and resolved it to change an Azure AD B2c based custom policy (*_TrustFrameworkBase.xml) as following,
<ClaimsProvider>
<DisplayName>Local Account SignIn</DisplayName>
<TechnicalProfiles>
<TechnicalProfile Id="login-NonInteractive">
<DisplayName>Local Account SignIn</DisplayName>
<Protocol Name="OpenIdConnect" />
<Metadata>
:
<!-- Item Key="grant_type">password</Item --> // Comment out this row
</Metadata>
:
</TechnicalProfile>
</TechnicalProfiles>