Your system administrator does not allow the use of saved credentials to log on to the remote computer

Solution 1:

If you don't want to change local or server side GPOs:

Go to Control Panel -> Credential Manager on the local computer you are trying to connect from.
You will see three sections:

1. Windows Credentials
2. Certificate-Based Credentials
3. Generic Credentials

Remove the credentials from Windows Credentials and add it to Generic Credentials.

Solution 2:

Here is a link on how to accomplish this: http://netport.org/?p=255

Update 4 setting in the group policy editor in Windows 7.

This security measure could frustrating when you connect and disconnect a lot to the same (or many) terminal server. To get rid of it and to be able to use saved credentials in this situation you need to configure the following:

Go to Start -> type: gpedit.msc -> in the console configure the following:

Enable the each shown policy and then click on the “Show” button to get to the server list and add TERMSRV/* (or alternatively just *) to the server. In my case it’s ‘*’ which indicates that cached credentials will be allowed to all servers.

The last thing to do is refreshing policy. To do that just go to command line (run as administrator) and type: gpupdate /force

That’s it. Now you can connect to your terminal servers by just clicking on .rdp files.