How Will Blockchain Revolutionize The Payroll Process?

What is blockchain? 

Blockchain is a new concept, and not a lot of light is shed on the topic. As a result, blockchain looks like a complicated technology which can be the case as well. But the core concept of blockchain is quite simple to understand.

According to market.us, The global Blockchain Technology Market size was valued at USD 4.93 Billion in 2021 and it is projected to reach around USD 2767.6 Billion by 2032 at a CAGR of 77.80% between 2022 to 2032.  

Blockchain technology is a database to store transaction details. The algorithm of the database is designed in such a way that it is difficult or impossible to alter, hack, or deceive the system. Blockchain is a digital ledger of transactions that can replicate and be shared on all the servers of the computer systems on the blockchain. If you're looking to develop blockchain solutions, you may want to consider partnering with a Blockchain Development Company.

The global blockchain-as-a-service (BaaS) market size was USD 1.90 billion in 2019 and is projected to reach USD 24.94 billion by 2027, exhibiting a CAGR of 39.5% during the forecast period.

Every block in the chain contains multiple transactions, and each time you make a new transaction, a record of it gets added to every participant’s ledger. That is why blockchain technology will have a positive impact on payroll software. 

How to use blockchain in payroll processes? 

Blockchain transaction ledgers are easily trackable in a decentralized system. It helps the transaction history to be more transparent and unquestionable. Employee payroll management system has to comply with a lot of regulations and blockchain will help to reduce the discrepancies and save time for the HR department. 

The payroll management software solution currently helps track time, attendance, benefits, payroll, fraud prevention, and timetable management. Business HR leaders explore the possibilities of using blockchain in the above processes to simplify and strengthen the processes. 

What are the benefits of blockchain on HR and payroll processes?

1. Blockchain technology is an efficient tool to save HR from cybercriminals: 

The human resource department deals with a lot of private, confidential, and sensitive information about their employees and finances. Employee payroll management software processes and stores information related to salary, health insurance, finances, banking, and other sensitive data. There are numerous hackers and other cyber criminals just waiting to exploit and misuse this sensitive information. 

Implementation of blockchain in the payroll management software solution will reduce the risk of cybercriminal attacks. Moreover, blockchain is a decentralized system, and hackers do not have a single opportunity to corrupt or even access the data. Also, the blockchain algorithm specifies that any changes made in the block should be verified and authorized. 

2. Blockchain has the potential to transform the hiring and recruitment process: 

At present, the whole process of attracting talent, understanding whether they are fit for the organization or not, and pre-verification of the candidate is time-consuming. Moreover, there are higher chances of potential fraud and inaccuracy. 

For instance, the candidate might manipulate the resume according to the job description. They are even capable of making fake documents and references to make them even more trustable. The HR department might have to wait for days or even months to hear a reply from the references; or the company. 

Moreover imagine, if the companies start storing the employee records on blocks. The candidate can give access to the future employer to the blocks of the employee records. The employee payroll management software with blockchain will provide employers access to previous employment, recommendation letters, educational documents, and many other vital data. 

3. Blockchain will enhance the payment process of contract workers: 

Organizations along with having full-time employees; will also have a workforce working on a contract basis. These contract workers have to wait for a longer duration to get paid because the invoices go through a verification process. Businesses with payroll processing software with blockchain can automate the verification process and pay the contract workers immediately after the work completes. 

4. Blockchain will provide accurate time and attendance data: 

Firstly, blockchain technology ensures the employee database is accurate and does not allow anyone to alter it. This means payroll software for small businesses with blockchain will ensure that the time, attendance, and leave data gathered by the system is accurate and no one has tampered with the database. 

5. Blockchain will help businesses to pay in cryptocurrency: 

The best part of cryptocurrency is the decentralization and if the payroll processing software pays the employee in cryptocurrencies will have multiple benefits. Firstly, the global workforce will have a standard paycheck which will remove inequality around the globe. 

Moreover, crypto is not accepted or banned by many governments globally. For these countries paying in cryptocurrency is not an option, and they have to pay in their local currency. The payroll software with blockchain will ensure transparency, accuracy, and speed in the payroll processes. 

Conclusion: 

The change has started taking place in various sectors, but the question is are you ready to embrace the change? Implementation of blockchain in the payroll software will revolutionize the entire working and paying process. Blockchain has the potential to revolutionize many aspects of HR and payroll processes.