The most common cause for this problem is incorrect permission on /etc/ssh/sshd_config.

The default permission on /etc/ssh/sshd_config is 644 and owned by root system.

Check the permission on the sshd_config file.

# ls -l /etc/ssh/sshd_config

Change the permission on the sshd_config file to 644 if it is something other than 644. (rw-r–r–)

# chmod 644 /etc/ssh/sshd_config

Test by attempting another sftp request.

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