Best Direct Deposit Payroll Software of 2025

Here's what we'll cover:

What is direct deposit payroll software?

Features of direct deposit payroll software

Benefits of direct deposit payroll software

How to choose the right direct deposit payroll software

Understanding payroll market trends

Direct deposit payroll software essentials

Direct deposit payroll software allows organizations to set up a recurring process with banks to transfer money from their bank account to employees' bank accounts on a specific day every month. Additionally, the software can enable organizations to process salaries, make deductions, calculate bonuses, and manage employees’ time off.

Accountants, payroll specialists, and HR personnel use payroll solutions to track and maintain payment records. But any business with paid employees should be using a dedicated payroll solution to compensate its workers as well as independent contractors, gig workers, freelancers, and consultants. 

Payroll software is typically priced on a “per month” basis, starting at $497 for basic systems. [1] More advanced platforms escalate in price as they often require customizations for larger teams.

First-time buyers should consider their budget, the number of users, specific use cases, and necessary integrations. Consulting stakeholders to determine key questions for vendors can help you find the best system. Questions for vendors may include:

• Does this tool enable users to view and track pertinent metrics to create payroll reports?

• How can we use this tool to automate payroll tasks such as tracking an employee's leave balance or calculating gross wages and taxes?

• Does this tool also manage compliance regulation updates or tax rate changes?

• What level of technical support will I need from the payroll software provider?

Because there are 218 different direct deposit payroll software vendors on Software Advice, choosing the right option can be a lengthy process. In this guide, you’ll learn the essential components of direct deposit payroll software, get step-by-step guidance on how to choose the right tool for your company, and tap into the expertise of experienced software advisors Steven Burlison and Ryan Eschenburg, who have led over hundreds of buyers to the right HR tools over a combined 17 years.

What is direct deposit payroll software?

Direct deposit payroll software is a human resources (HR) tool that enables organizations to process salaries, make deductions, calculate bonuses, and manage employee time off. The software allows organizations to set up a recurring process with banks to transfer money from their bank account to employees’ bank accounts on a specific day every month.

Any business with paid employees should be using a dedicated payroll solution. To make the payment process transparent and convenient, businesses of any size can opt for direct deposit payroll software.

Direct deposit is a form of electronic payment via ACH (automated clearing house) that many organizations use to pay their staff. Even the U.S. federal government uses it to send social security payments.

Directly depositing employee salaries saves the cost of paper checks, is environment friendly, and lowers the chances of fraud due to loss or theft of paper checks. Direct deposit payroll software helps out by processing unlimited transactions to meet your staff's payment needs.

We created this buyers guide to help you understand how this software works. We're detailing everything you need to know before you choose a solution for your business.

Features of direct deposit payroll software

All direct deposit payroll software includes direct deposit, payroll management, payroll reporting, and tax compliance features. Most share a variety of common features such as approval process control, benefits management, compensation management, and employee self service.

Core direct deposit payroll software features

Each year we speak to dozens of direct deposit payroll users and have analyzed those conversations to give a better understanding of which features are critical to small businesses. [2]

Common direct deposit payroll software features

Benefits of direct deposit payroll software

While a streamlined payments process is the most important benefit of this software, here's a list of additional benefits:

Safety and reliability 

The direct deposit process is a convenient way to pay employees on the payout day itself, regardless of their location. Paper checks can get delayed in reaching the bank due to bad weather, misplaced checks, employees on vacation, etc. Any of these reasons could result in employees not getting paid on time, which can put a financial strain on their personal lives.

However, direct deposit isn't dependent on any such factors. Businesses can easily set up the software and ensure stress-free pay schedules for themselves and their employees.

Direct deposit records in SurePayroll

Time and cost savings

Employees who receive paper checks may feel the need to leave work on payout days to deposit their check during business hours. This means low productivity on payout days. As the software automatically credits the salary into employees' bank account, you save their time as well as your organization's.

This type of software also makes it easy and safe to consistently pay staff salaries. Businesses can set up a recurring process with their banks to electronically transfer the money from their savings or checking account into the employees' bank accounts on a specific day every month. You'll also no longer spend time or money on writing or printing checks.

It is worth noting, however, that some software buyers still want a payroll tool that offers both direct deposit and check printing, usually to serve as additional confirmation of payment. “It’s rare, but it does happen,” says Burlison. “Every now and then you hear people specify that they want [a tool] to print checks because they assume that it won't do that.” If you are one such buyer, ask an advisor for help finding products that offer this feature.

How to choose the right direct deposit payroll software

When you start the process of checking out potential direct deposit payroll solutions, you should detail all your requirements and categorize them based on their importance. Nice-to-have features, such as check printing, can come at the very end. Therefore, the solutions you’re considering should address all your crucial needs first.

Step 1: Know what type of buyer you are

Before you start evaluating various direct deposit payroll software, you should know which buyer category you fall into and what that means as you choose direct deposit software. We believe most buyers can be categorized as one of the below types:

• Small businesses. These buyers focus on basic day-to-day requirements such as depositing employees salaries, calculating taxes quickly and managing employee time off efficiently. They require a simple, dedicated direct deposit payroll software that fulfills their needs and can be scaled up over time. They're mainly looking to streamline their payroll process at an affordable price.

According to Eschenburg, some small-business software buyers who are shopping for a direct deposit payroll system might be using payment processing apps or writing personal checks to pay staff. Since neither method accounts for tax withholding or tracks hours worked, direct deposit payroll software is more sustainable for their growing business.

• Midsize businesses. Apart from the basic capabilities, these buyers may need additional and more advanced features. They usually have an established HR team, so they'd also need third-party integrations with existing HR software to import/export employee data.

• Large businesses. These buyers need almost all the features in a solution. They ideally look for a full-featured solution that's part of a suite that covers extra modules, such as HR and accounting, for smoother operations. Due to a larger number of employees and to avoid the hassle of handling everyone's daily needs, they may also require an employee portal that allows employees to access, view, and manage their personal information at any time.

Step 2: Make a shortlist of direct deposit payroll software

With so many payroll software options to choose from, it can be a challenge to narrow down the options that are right for your business—but with the right resources and support, it doesn’t have to be.

Get qualified help from an advisor

At Software Advice, our advisors (like Burlison and Eschenburg) have experience helping hundreds of business owners identify solutions that match their needs and budgets.

If you need guidance, you can chat online now with an advisor or schedule a phone call. In just a few minutes, your advisor will help you identify a shortlist of options that align with your company’s requirements.

Explore our list of payroll FrontRunners

If you’re not ready to speak to an advisor just yet, you can also start compiling your shortlist of payroll software with our FrontRunners report. Only products that earn top user ratings make this list. To be eligible for consideration, a product must:

• Have at least 20 unique user reviews in the last 24 months

• Be a stand-alone payroll software product

• Offer these features: direct deposit, payroll management, payroll reporting, and tax compliance.

Check out our full methodology description for more detail on how the report is compiled.

Step 3: Pick your best option

Now that you’ve compiled a list of your top choices, you should start scheduling vendor demos. Vendor demos help you explore features, understand pricing, and ultimately make the right investment. Preparation is key to getting the most out of these sessions, so here's a list of questions you should ask the vendor:

• Is the software scalable?

Check whether the direct deposit payroll software you're considering will adapt and scale up as your business grows. The software should automatically add new employees to the distribution list when they're onboarded. Make sure you ask the vendor whether you'll be charged extra for adding new employees.

• Does the software support integration?

Ask vendors whether their solution supports integrations with your existing applications, such as HR and accounting systems. Be specific about all the stakeholders who'll use the software and the effort, time, and costs associated with integrations.

• Does the vendor offer customer support?

Find out whether your ideal vendor offers support 24/7, only during business hours or not at all. Also, ask for the available support options such as email, phone, or live chat. Make sure to ask the vendor about their usual response time, so that you're able to get your employees' salary issues and queries resolved on time.

Understanding payroll market trends

Cloud technology has influenced the way businesses execute payroll operations. Today, many businesses are transitioning to cloud-based tools to help HR managers track payroll in real time and auto-generate payroll data cost. Here are some trends in this industry to keep an eye on.

• Hyperautomation: Among the top emerging technology trends in HR, hyperautomation is influencing how activities such as payroll are being processed and enhancing efficiency and reliability across manual workflows. However, the limited expertise of the HR team is among the main barriers that stand in the way of the full potential of this technology. [3]

• Multi-country payroll: Gartner predicts that by 2025, 65% of global midmarket and large enterprises will have invested in a strategy to unify multi-country payroll using no more than three separate vendors. [4] Hybrid work has made it possible for employees to work from payroll jurisdictions that differ from the company’s registered office locations. HR is also looking for talent that may be located in different countries but have specialized skills. This has led to an increase in the demand for multi-country payroll solutions.

Note: Interview questions and responses have been edited for brevity and clarity.

About our contributors

Author

Lauren Spiller is a senior content writer at Software Advice, covering sales and CRM with a focus on retail and customer experience. After receiving an MA in rhetoric and composition from Texas State University, Lauren has pursued a career that allows her to help others through writing.

Lauren’s research and writing for Software Advice is informed by nearly 300,000 authentic user reviews and more than 15,000 interactions between Software Advice software advisors and CRM or sales software buyers. Lauren also regularly speaks to leaders in the sales and CRM space so she can provide the most up-to-date and helpful information to small and midsize businesses purchasing software or services.

Lauren previously taught college writing and served as writing center assistant director at Texas State University. She has presented at the European Writing Centers Association, Canadian Writing Centres Association, and the International Writing Centers Association conferences. She currently lives in Wimberley, Texas, with her husband and their three cat sons.

Editor

Carolyn Santa Maria is a senior editor at Software Advice.

Carolyn has been working in content for more than five years as an editor. With her keen eye for detail, technical experience, and cross-team collaborative expertise, she has developed new content types, briefs, and processes for a variety of different projects and teams. She has edited a large variety of content, including research reports, white papers, eBooks, email marketing campaigns, and many other types of technical papers.

When she isn’t correcting grammar or changing the structural flow of an article, Carolyn is spending her time with her nose in a book, cuddling with her dog Mac, or traversing Austin looking for the best meal.

Advisors

Ryan Eschenburg is a senior advisor. He joined Software Advice in 2014, and he is based in Austin, TX.

Ryan works directly with small-business leaders to connect them with best fit software providers. He assesses the technology needs of small businesses seeking HR and learning management software through one-to-one conversations and provides a short list of potential matches. 

His favorite part of being a software advisor is helping buyers ease their stress and save time during their software search.

Steve Burlison is a senior advisor. He joined Software Advice in 2017 as a software advisor and is based in Austin, TX.

As part of the software advisor team, Steve helps HR and learning management industry professionals who are seeking tools such as recruiting, training, and talent management software. He provides a short list of personalized technology recommendations based on budget, business goals, and other specific needs. 

Steve’s favorite part of being a software advisor is partnering with overwhelmed buyers to navigate the confusing software landscape; he enjoys discovering the specific tool a buyer needs and explaining how it will help them.

Sources

1. Software Advice software pricing data: Only products with publicly available pricing information and qualified software products within the category, as of November 29, 2023, are included in the pricing analysis.

2. Software Advice advisor call notes: Findings are based on data from telephonic conversations that Software Advice’s advisor team had with small-to-midsize businesses seeking direct deposit payroll tools. For this report, we analyzed phone interactions from July 31, 2023, to July 31, 2024. 

3. 8 Learnings from Gartner’s Hype Cycle for HR Transformation, Gartner

4. Market Guide for Multicountry Payroll Solutions, Gartner