Cannot connect to Remote Desktop with Windows Hello PIN

When I try to connect to an intranet machine, it only works if I specify domain credentials. When I use Windows Hello pin, it fails with this message:

An authentication error has occurred (Code: 0x8007013d)
Remote computer: theremotecomputername

Additional information:

• Client is running Win10 enterprise. I can use the Windows Hello PIN normally for login into client and for applications. Only RDP fails.
• Remote computer can be either Win10 enterprise or Win2016 server. Both fail.
• Client and remote are domain-joined and I am admin of these computers (I'm not domain admin).
• I can connect to remote with domain credentials, however any application that requires a PIN in the remote computer fails.

You need to activate group policy "Use Windows Hello for Business certificates as smart card certificates".