@Digiplay the mail server is offering CRAM-MD5 authentication and that is being chosen by phpmailer, the package used by phplist, for authentication.
Can you configure the mail server to offer only PLAIN?
phplist doesn’t provide a configuration for the authentication method, so otherwise you will need to modify either phplist code or phpmailer code.
Possibly the simplest is the phpmailer file admin/PHPMailer6/src/SMTP.php around line 485
foreach (['CRAM-MD5', 'LOGIN', 'PLAIN', 'XOAUTH2'] as $method) {
Try removing CRAM-MD5 from that list.
or lin 451 of file admin/PHPMailer/class.smtp.php if you are not using PHPMailer 6.
foreach (array('CRAM-MD5', 'LOGIN', 'PLAIN', 'NTLM', 'XOAUTH2') as $method) {