Top 10 Payroll Software in India for Small Businesses (2026 Guide)

Introduction

If you're a small business in India struggling with compliance, payout delays, manual HR processes, and payroll errors, this guide will help you choose the best payroll software in India to automate your tasks, stay compliant, and improve efficiency. In this article, we break down the top 10 payroll tools tailored for Indian SMEs starting with Runtime HRMS and Payroll Software as the #1 choice.

Payroll is one of the most complicated and time-consuming functions for small businesses in India. With constantly changing labour laws, components like PF, ESI, PT, LWF, TDS, and bonuses, and the pressure to ensure on-time salary payments, HR teams often spend hours every month juggling spreadsheets and manual calculations. The risk of compliance errors, dissatisfied employees, and inefficiency only grows with time.

A single payroll mistake can lead to statutory penalties, employee dissatisfaction, or even attrition. Manual processes slow down HR teams, leave room for errors, and create stress during every payroll cycle. As businesses grow, these cracks widen making payroll a bottleneck instead of a smooth, recurring process.

A modern employee payroll management system eliminates these challenges by automating calculations, syncing attendance and leave data, generating compliant payslips, and ensuring real-time statutory compliance updates. Whether you choose an hrms payroll solution or a dedicated hr and payroll software, automation helps you save time, reduce errors, and empower your team. This blog highlights the top 10 cloud based payroll software India options designed specifically for SMBs, helping you find the perfect online payroll management software for your business.

Below is a detailed breakdown of the best payroll tools available for Indian SMEs in 2026.

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1. Runtime HRMS and Payroll Software (Best Overall for SMEs)

Runtime HRMS leads the list for its complete, India-first payroll automation designed specifically for small and medium businesses. Its powerful payroll system ensures accurate, compliant payroll processing without the complexity. Customer feedback says that it is one of the easiest software to use with minimal training. Also it is one of the most afforable HRMS in India. 

Key Features of Runtime HRMS

• Automated salary computation and payslip generation

• Statutory compliance: PF, PT, ESI, TDS, LWF, Gratuity, Bonus

• End-to-end HRMS with attendance, leave, time tracking to employee exit

• Cloud-based and mobile-ready 

• Employee Self-Service (ESS) portal known as 'Runtime Workman'

• Smooth onboarding and lifecycle management

• Highly intuitive UI with fast setup

Why It’s #1 on this list

It's affordable, user-friendly, and seamlessly integrates HR and payroll making it ideal for fast-growing SMEs.

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2. Zoho Payroll

A simple, reliable choice for Indian SMEs, especially those using Zoho’s ecosystem.

Key Features of Zoho Payroll 

• Automated payroll runs

• Full statutory compliance

• Seamless integration with Zoho People & Zoho Books

• ESS portal is available  

• Reimbursements and expense management

Best For

Zoho-enabled businesses looking for an easy payroll extension.

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3. greytHR

One of the most trusted payroll and HR software platforms in India with strong compliance capabilities. GreytHR is used by 30,000+ companies with over 3 million users and counting from across 21 countries. 

Key Features of greytHR

• Payroll automation

• Real-time compliance updates

• Attendance & leave integration

• Document management

• Mobile HR app

Best For

Businesses prioritizing compliance accuracy and strong HR workflows.

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4. Keka Payroll

A beautifully designed HRMS with robust payroll automation. Keka can help you manage the folllowing tasks for your company - Hiring & Onboarding, learning management system (LMS), Timesheets & Projects, Time & Attendance Tracking and much more. 

Key Features

• Modern UI

• Attendance, shift, and biometric integrations

• AI-backed productivity features

• TDS automation and more

• HR & Payroll analytics 

• Expense tracking

Best Solution For

Companies that value user experience and scalability.

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5. RazorpayX Payroll

A fintech-powered payroll solution by Razorpay known for effortless payouts. Ideally used by companies with large employee count. 

Key Features

• Automated salary transfers

• Contractor payments

• Compliance filing

• Attendance integrations

• Startup-friendly pricing

Best For

Startups needing automated payouts for teams and contractors.

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6. BambooHR (with India payroll integrations)

BambooHR is a global HRMS that many Indian SMEs integrate with local payroll partners. Around 34,000 business rely on BambooHR for their payroll needs. BambooHR customers have so far saved hundreds of operational hours and reduce their human resource costs by 40%. 

Key Features of BambooHR

• Core HR, onboarding, and performance

• Custom workflows

• Mobile app

• Integration-friendly architecture

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7. Qandle

Qandle is a modern, customizable HR suite that provides a comprehensive payroll engine along with powerful HR automation tools. It is designed for businesses that want flexibility, ease of use, and end-to-end HR digitization. Its modular approach makes it ideal for SMEs looking to scale without switching systems.

Key Features

• Smart payroll engine

• Attendance & shift management

• Travel and reimbursement module

• Custom workflows

• Manager & ESS dashboards

Businesses seeking a flexible, customizable HR solution with integrated payroll and expert support capabilities can opt for Qandle. 

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8. factoHR

A strong contender for companies with growth plans and multi-location operations.

Key Features

• End-to-end HRMS

• Payroll with compliance automation

• Attendance and shift planning

• Mobile app

• Performance and productivity tools

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9. SumHR

A simple, user-friendly payroll solution ideal for growing startups.

Key Features

• Easy payroll processing

• Tax automation

• Attendance & leave management

• Employee directory

• Quick setup

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10. Kredily

A budget-friendly HR and payroll tool with a freemium model. Kredily is an ideal software for micro businesses or early-stage startups.

Key Features

• Free HR & payroll

• Attendance & leave tracking

• Automated payroll processing

• ESS app

• Basic compliance features

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How to Choose the Right Payroll Software for Your Business

Selecting the right online payroll management software requires evaluating the following:

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1. Compliance Automation

In India, payroll compliance is a complex task. A reliable employee payroll management system should automate statutory calculations to ensure accuracy and protect your business from costly penalties. Your payroll software should handle:

1. PF (Provident Fund) - Automatically calculates employer and employee PF contributions and generates monthly challans.
2. ESI (Employee State Insurance) - Computes ESI deductions and prepares filings for eligible employees based on wage thresholds.
3. PT (Professional Tax) - Applies state-specific PT slabs and generates monthly or annual returns depending on local regulations.
4. TDS (Tax Deducted at Source) - Auto-calculates TDS based on employee income, declarations, and exemptions, ensuring accurate tax withholding.
5. LWF (Labour Welfare Fund) - Applies state-wise LWF contributions and schedules deductions based on statutory rules.
6. Bonus & Gratuity - Calculates statutory bonus and gratuity eligibility automatically based on tenure, salary, and government norms.
7. Labour Law Updates - Keeps your payroll engine compliant with new notifications, rule changes, and government circulars without manual intervention.

Automating compliance eliminates human error, ensures complete accuracy, and protects your business from fines, penalties, and legal disputes.

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2. Attendance and Leave Integrations

An efficient payroll system must seamlessly integrate attendance and leave data to ensure accurate salary calculations. When these components sync automatically, HR teams avoid manual reconciliation and payroll errors. Look for:

• Biometric integrations - Supports fingerprint or facial recognition devices to accurately capture in/out timings and prevent proxy attendance.

• GPS/geofencing - Enables location-based attendance for field teams or remote workers, ensuring employees clock in only from approved locations.

• Overtime rules - Automatically calculates overtime based on predefined company rules, eliminating manual tracking and ensuring fair compensation.

• Shift scheduling - Manages multiple shifts, night differentials, and rotating schedules, ensuring correct attendance mapping for diverse teams.

A strong hrms payroll system syncs all attendance and leave data automatically, reducing errors and ensuring payroll is processed quickly, accurately, and transparently.

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3. Cloud-Based Accessibility

A cloud based payroll software India platform ensures:

• No maintenance - Cloud payroll requires no hardware installation or on-site servers, eliminating the need for IT maintenance. All infrastructure is managed by the provider, allowing HR teams to focus purely on operations instead of tech troubleshooting.

• Auto-updates - Software updates, security patches, and statutory compliance changes are rolled out automatically. This ensures you’re always on the latest version, fully compliant with new regulations without manual effort or downtime.

• Remote access - With cloud access, HR managers can process payroll, verify attendance, or approve reimbursements from any location. This flexibility is essential for hybrid teams or companies with multiple branches, enabling payroll continuity regardless of where the team is working.

• Better data security - Cloud payroll platforms use encryption, secure servers, and role-based access to keep sensitive employee data safe. This dramatically reduces risks like data loss, unauthorized access, or security breaches compared to traditional spreadsheets or offline systems.

Perfect for SMEs with no dedicated IT team.

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4. Employee Self-Service (ESS)

Enables employees to access:

• Payslips - Employees can instantly download monthly payslips from the ESS portal

• Leave balances - Employees can check their available leave, apply for time off, track approvals, and view past leave history directly through the portal.

• Tax documents - ESS portals allow employees to view and download essential tax documents such as Form 16, tax computation sheets, and monthly TDS summaries.

• Investment declarations - Employees can upload proof of investments, declare tax-saving instruments, and update their financial details online.

When employees can manage these functions independently, HR teams spend far less time on routine queries. This frees them up to focus on strategic initiatives such as hiring, employee engagement, and compliance. For small businesses with lean HR teams, this level of automation can be transformative. 

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5. Scalability and Pricing

Choose software that grows with your team:

• Modular features

• Pay-per-user pricing

• Upgrade-friendly plans

Runtime HRMS, Zoho, and greytHR fit these criteria well.

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6. Customer Support

Essential for smooth payroll cycles:

• Quick response time

• Local support

• Live chat or phone support

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Why Payroll Automation Is Essential for SMEs

1. Saves Time and Reduces Errors

Automated tools decrease payroll time by up to 90%.

2. Enhances Employee Trust

Accurate, timely payouts improve workplace morale.

3. Ensures Compliance

Avoid penalties and maintain regulatory hygiene.

4. Boosts Overall Productivity

HR teams focus on strategic work instead of repetitive tasks.

5. Provides Actionable Insights

Dashboards help you analyze payroll costs and workforce trends.

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Conclusion

Payroll is the backbone of business operations. Whether you're managing 10 employees or more than 500, the right hr and payroll software can simplify workflows, ensure compliance, and elevate employee experience. After evaluating several tools, Runtime HRMS and Payroll Software stands out as the most comprehensive and SME-friendly solution for Indian businesses.

By investing in the right employee payroll management system, you set your business up for efficiency, growth, and improved employee satisfaction.