Asia Pacific’s (APAC) organisations are scaling up the use of artificial intelligence (AI) to modernise payroll delivery as skills shortages persist and workforce models evolve, according to ADP’s latest report, The Potential of Payroll 2026.
The report finds that skills shortages continue to challenge payroll teams in APAC, with 80% of organisations reviewing how to run payroll with fewer people, well above the global average of 72%. Reskilling and upskilling are top-of-mind priorities to address this, with nearly seven in 10 (74%) payroll leaders in APAC reporting that staff shortages have already impacted their payroll operations.
Organisations are turning to AI to complement upskilling, with nearly half (49%) of respondents exploring the technology to support leaner operating models, and a further 33% of organisations identifying AI as a key driver of payroll transformation over the next 2-3 years. Today, organisations are primarily using AI to detect fraudulent transactions, accelerate report generation, and automate data entry.
India is emerging as one of the most proactive markets globally in adopting AI into payroll process. More than one-third (34%) of Indian organisations surveyed plan to implement AI in the near term, ranking second worldwide.
Rahul Goyal, Managing Director, ADP India and Southeast Asia, said: “In India, payroll sits at the intersection of scale and scrutiny. Organisations are prioritising stronger controls, audit readiness, and high quality data to support decision-making. As AI takes on repeatable tasks, payroll teams will shift their focus to data integrity, regulatory navigation and governance excellence.”
The study surveyed over 1,800 senior payroll stakeholders from organisations with 1,000 or more employees globally. Respondents included leaders from Australia, China, Singapore, India, and Japan, and the study examined how payroll is adapting to technological, regulatory, and workforce changes.
AI adoption in India is already expanding across critical payroll functions. Around half of the companies using AI are applying it to automate workflows, streamline data entry, and calculate taxes, benefits and overtime. Additional areas currently being explored or implemented include audits, compliance management and data validation, according to the report.
