Why your business need a payroll management system and How to choose best payroll management system

In-house payroll management has almost become similar to moving mountains for a business and this is particularly more frequent when it comes to managing a remote workforce. And secondly, with the advent of advanced tools and technologies, it is difficult for companies to keep up with their competition. Outsourcing has become a survival instinct for businesses facing such problems today. So for a business to optimize its productivity, it has become integral to invest in a robust and dependable payroll management system rather than relying on some of the old standalone tools operating in silos.


Employees are the backbone of any company as they work very hard for its growth and in return, they expect to get accurate payments in time. If salaries are not paid on time it, it may eventually lead to underperformance and employees questioning the authenticity of the company, which is sure to hamper the company’s growth and reputation. By adopting a robust payroll management system, management does not have to worry about paying the employees on time, which will automatically make sure that they give their best to the growth and development of your business.


Typically smaller companies do not pay attention to the need of a payroll system. It is a misconception that payroll is only about calculating a certain sum of money. In reality manually calculating paychecks is a very cumbersome and challenging process. Tiny errors (perceived) here and there have known to have a huge impact. Apart from inaccurate paychecks for the employees it can also lead to a number of penalties. Thus the management needs to hire someone who is entirely familiar with all the calculations of paychecks. On the other hand it is better to have a  reliable payroll management system to take care of this process.

Comprehensive services:

Payroll management system are capable of carrying out much more than simply processing salary to employees. They also provide additional services such as bonus, increment regarding the individual employee’s contribution towards the company. Additional income for recognition of efforts has always helped to motivate employees to further increase their performance levels, which in turn ensures the success of the business and endorses the advancement of the company, irrespective of its size.

Optimizes time and efforts:

Managing the payroll system manually can be a very time-consuming task and can take away so much precious time. So, to keep up with the ever-changing world of business, the small business owners can outsource the payroll responsibilities to a payroll service provider or buy the best payroll software for small business. There is no dearth of payroll software in the market but it is advisable to rely on software that is authentic and password protected and aimed to produce flawless report and data. After all, when you can save both you and your payroll managing division’s time, why not go ahead for it and ensure the success of your small business!

Once you understand the importance of a payroll management system, it is time to select out of the varied options that are available in the Indian market. Typically, there are certain things to look out for before you finalize an option.

How to choose the best payroll management system:


Cost is the foremost factor whenever companies decide to adopt any new system in the workplace. Especially for smaller companies as they do not have the budgets that their larger counterparts enjoy. In fact, even for larger companies it does not make sense to waste money on an expensive payroll management system that usually falls short of providing good quality of services. Opt for a system that is affordable and gets the job in the most efficient manner providing you true value for money. Also watch out for any hidden pricing. Many a companies are surprised when the final cost does not match with the initial pricing that was agreed upon.


This is one of the biggest concerns as recent incidents of threats, such as hacking into systems all across the world have become even all the more critical. Payroll management systems are privy to a lot of sensitive employee data that needs to be safeguarded at any cost. Unfortunately, a few service providers have lax security which led to loss of critical information. This security largely depends on the technology platforms and as such should be robust enough to handle major problems.

Legal compliances:

Failure to comply with Indian tax compliances can cost companies to a great extent! Not to mention the damage their reputation may suffer. All statutory compliances such as minimum wages, TDS deduction, ESI finds, PF deduction, gratuity, etc. need to be strictly avoided to avoid penalties.  

Thus, to summarize, payroll management systems is definitely a boon if companies carry out their due diligence and make sure they select the right partner for providing these services.