Delivering payroll payments to staff across multiple regions is a complex undertaking. What makes it such a challenge and what trends can you expect to see in payment compliance this year?

Why payment compliance is so critical to payroll success

Employees expect to always receive their salaries on time and in full. Overpayment, underpayment or other errors can lead to frustration, a loss of trust and ultimately, employee turnover. It is crucial for companies that operate globally to be able to deliver payroll payments seamlessly and compliantly.

But, this requires an intricate understanding of and adherence to local labour laws, tax regulations and compliance requirements (both payroll and financial) in territories that often have their own unique rules and languages. The risk of non-compliance can include, but is not limited to, heavy fines, legal penalties, reputational damage and even prison. For companies that operate globally, payment compliance is non-negotiable.

As ever, transactions need to be faster and more secure. Let’s look at the payment compliance trends to watch out for in 2025.

1. Multi-country landscape will continue to be a challenge for payroll management

‘Frictionless’ payroll transactions has been a goal for organisations that pay staff across multiple countries. In 2025, payroll teams will continue to face challenges with¹:

• Constantly-evolving regulations (particularly as governments and policies change)
• Fluctuating exchange rates
• Complex settlement processes

Teams will look to technology enhancements and additional resources, or partnership with payment providers experienced in the delivery of payroll and statutory payments, in order to stay ahead.

2. Regulatory compliance remains at the forefront

Cross-border payments are subject to different regulations and companies have to ensure their payment processes meet the required compliance standards, both in the origin country, and across the jurisdictions in which they deliver payments. For those in Europe, ongoing preparations for new regulations such as the third Payment Services Directive (PSD3) and Payment Services Regulation (PSR), set to take effect in 2026, will be necessary to ensure their payment processes are compliant.

Many will look to automation, using global payroll management tools that integrate local tax and compliance regulations, to streamline their international payroll processing.

Payroll payment providers that are regulated and experienced in meeting global compliance requirements, particularly in ensuring strict controls and procedures around AML & KYC, will be key in delivering specialised solutions that are tailored to their clients.

3. Enhanced use of AI technologies to detect fraud

Managing and preventing payment fraud will require stronger security measures. For example, the increasing number and types of Authorised Push Payment (APP) fraud in the UK alone² raises the need for proactive risk management and mitigation.

Financial institutions and payment service providers will look to advanced AI models and machine learning to help better predict and detect fraud and unauthorised transactions – particularly as fraudsters themselves become more sophisticated in utilising AI methods such as deepfakes or personalised phishing messages to pose threats³.

4. Instant payroll to join broader financial wellness tools

As a growing but often-debated trend in recent years, instant payroll (also referred to as earned wage access, on-demand pay or instant pay) will continue to be a popular benefit for employees who wish to receive a portion of their pay ahead of scheduled pay cycles⁴.

Employers are likely to integrate it into their payroll solutions along with further financial wellbeing tools and features. They will need to ensure compliance with relevant labour laws regarding timing, taxes and record-keeping. The CIPP’s EWA Code of Practice, for example, stipulates that providers ‘must undergo a regular independent assurance assessment’ in order to be compliant with the Code⁵.

5. More sophisticated threats require better, more compliant cyber resilience

Payment compliance requirements related to data and cybersecurity can vary based on the volume of payment data and location of the business. Despite this, data security practices will continue to be of key focus in 2025. For example, the EU’s Digital Operational Resilience Act (DORA) has recently gone into effect⁶ and mandates that all financial institutions, payment service providers and ICT providers serving customers in the EU must implement measures to increase digital resilience, reduce & mitigate cyber threats, and manage third-party risks.

How Ebury supports secure global payroll payments

Built with payroll expertise to simplify the global payment process, Ebury’s Mass Payments Solution ensures payments are delivered compliantly, on time and in full, every time. Underpinned by robust compliance and due diligence, Ebury adheres to strict operational processes to scrutinise the accuracy of each of our transactions.

Our risk management procedures are regularly audited and our pre-payment validation tools include multi-level authorisations to reduce payment failures and the risk of fraudulent or unauthorised activity. We ensure client funds are safeguarded and appropriately protected in accordance with required governing regulations.

Let’s start a conversation

Get in touch with our team if you would like to discuss your payroll payment needs and how Ebury can help you.

Sources
1. activpayroll
2. EY
3. Finextra, Bottomline Technologies
4. IRIS, Thomson Reuters
5. CIPP
6. Finextra

Disclaimer

The information provided herein is general in nature and should not be construed as financial or investment advice. The information provided here is not legally binding. The information, data or views expressed here is for the exclusive use of the recipient and is subject to changes without any notice. You may ask the support team or your dedicated relationship manager to provide additional information regarding Ebury products.