macOS 12 beta on VM (Parallels) not reading keyboard input

Hello,

I am on a 2016 MacBook Pro with macOS 11.4.1 installed.
I created a VM using Parallels 16.5.1 with the same macOS and everything was working well.
I enrolled that VM in the Apple Beta program and downloaded macOS 12. Installation seemed to succeed but upon reaching the login screen the VM was not recognising any keyboard input (neither built-in, nor bluetooth).
I am therefore stuck there. What can I do?
Thanks!

PS: developer beta 1 installed and worked well then dev beta 2 caused this issue. I tried again with public beta 1 with no success.
I have also entered Recovery from the VM and successfully reinstalled Monterey, no change. From within Recovery keyboard input is also not registered. I may try again but I would need to recreate all VM (including macOS 11) from scratch as I want to avoid enrolling my working machine.

If you have a shortcut issue, hot key or key combinations issue please check Shortcuts issues troubleshooting part of this article. If you are unable to type specific characters, please check Specific and National characters troubleshooting part of this article. If you have a keyboard layout issue, please check Keyboard layouts issue part of this article.

or Do follow these simple steps:

1.Select Virtual Machine, click Configure. 2.Click on the Hardware Tab and select Mouse and Keyboard. 3.For the options "Mouse" and "Keyboard" select "Optimize for games" from each of their drop-down options. 4.See if it will resolve the concern. For more related issues do mail me at my mail id mentioned in my Profile

macOS 12 beta on VM (Parallels) not reading keyboard input
 
 
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