This is a weird way to describe keyloggers if that is actually what they are talking about.
The random order I don't understand either unless the "keylogger" is also recording mouse positions.
Otherwise, if this is actually talking about over shoulder lookers it probably has the exact opposite effect because of the increased time require to enter a password.
Unless it's common for keyloggers to monitor the clipboard?
In which case, for the system they've developed to seemingly work as intended, you'll have to either have a memorizable password (likely relatively insecure), or have your password written down at hand.
I'm skeptical that this nonstandard, hostile UX was designed with any sort of valid threat analysis rather some kind of Rube Goldberg-esque security-through-obscurity scheme that "sounded good" during some meeting.
Anything more bespoke than that is probably much rarer.
I would bet that that is exactly what they are worried about. This seems to me to be a really hacky way to solve that problem. If you actually need to address the possibility of keyloggers then some sort of 2FA setup would be simpler, more standard, would address a wider variety of potential security problems, and would create less friction for the user.