Accounting Software Market Size, Share, Growth Report | 2031

Report Description

The global accounting software market size was around USD 16,584.08 Billion in 2022 and is expected to surpass USD 76,411.12 Billion by 2031, expanding at a CAGR of 18.5% during the forecast period, 2023–2031. The market growth is attributed to the rapid adaptation of automation for accurate data in accounting software and rising demand for cloud services accounting software for easy accessibility of financial data.

Accounting software manages all the transaction records of organizations or enterprises. It also offers various functions such as balance sheet, trial balance, invoicing, tax compliance, accounts payable and receivable, payroll, and income & expense statement.

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Accounting software makes it easy to enter all the relevant data into the system and that data is easily accessible to anyone who has the right permission. Clients can easily save all the data of entry, invoice, or record which is stored under the layers of encryption in the cloud.

Clients can save a lot of time & money by using accounting software. It also helps to reduce the number of errors due to the automation process of the software and offers customization as per clients’ demand. Accounting software can be used for various end user industry such as retail & E-commerce, manufacturing, IT & telecommunications, BSFI, healthcare, and others.

COVID-19 Impact on Accounting Software Market

The market report finds that the COVID-19 pandemic had positive impact on the global accounting software market. Due to the COVID-19 pandemic, governments and business asked their employees to work from home to maintain business continuity. Businesses and organizations adopted AI-based applications and software to reduce the work and for better output.

The use of accounting software increased during the COVID-19 pandemic owing to the advantage of cloud-based accounting software which enables easy access of all the encrypted data for clients at any time, anywhere. Accounting software can be used from anywhere and due to the work from home mode, major companies adopted various accounting software for better output during the pandemic.

Accounting Software Market Dynamics

The research report presents a complete overview by providing detailed information about the current market trends, existing drivers, growth opportunities and potentials, and emerging challenges. The accounting software market report has up-to-date insights about market dynamics and market scenarios that can shape the overall market performance and output during the forecast period, 2023 to 2031.

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Key Trends

In the global accounting software market, automation is an ongoing trend that is used in various major accounting software to enhance the output for clients. Automation helps to increase efficiency and ensure error-free transactions between clients and companies. Major organizations and companies are adapting automation for accounting to reduce the errors and it has enabled organizations to reduce their human resources. 

Major Drivers

 The global accounting software market is likely to boost in the upcoming years owing to the increasing demand for cloud-based accounting software from clients. Accounting software keep all the transactions history of organizations. Cloud-based accounting software offer better security and real-time updates for accounting software solutions.

This accounting software saves a lot of time and clients can easily access all the data at any time and from anywhere. Major end-user industries are focusing on adapting cloud-based software market as it is cost-effective and transparency of financial information. This can help to boost the accounting software industry.

Existing Restraints

The accounting software can be used for better output and for time saving but the high cost of accounting software can hamper the global accounting software market. Accounting software needs to be installed on some computer hardware which can cost more, and it needs to be maintained per month by the means of subscription. High cost of per month subscription for accounting software can hinder the market growth.

Emerging Opportunities

New upcoming technological advancements to enhance the current accounting software format and make it more convenient for end users can produce lucrative opportunities for the global accounting software market. Increasing R&D to improve and introduce new services along with accounting software can produce new opportunities for the global market. This new improvement can attract new end user which can be the major factor to boost the market growth.

Scope of Accounting Software Market Report

The accounting software market research report includes an assessment of the market trends, segments, and regional markets. Overview and dynamics have also been included in the report.

Accounting Software Market Segment Insights

Component Segment Analysis

Based on component, the accounting software market share is divided into solution and service. The solution segment accounted the major share of the market in 2021. The solution segment is expected to expand at a significant growth rate during the projected period owing to the benefits to eliminate the manual process.

The solution segment accounted the major market share in 2021 due to the rise in use of automation for better solutions for clients. Accounting software is widely used for solution purposes to reduce cost & time. However, the service segment is anticipated to hold a key share of the market in the coming years due to the various services attributed to the accounting software.

Other than solutions, accounting software offers various services for the clients such as balance sheet, income & expense statements, payroll, easy tax filling, and cash flow analysis. These services can enhance the software implementation and attract new users for better financial solutions.

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Enterprise Size Segment Analysis

Based on enterprise size, the global market is segregated into small & medium enterprise. The large enterprise segment is projected to register a considerable CAGR during the forecast period due to increasing use of accounting software in large enterprise to manage and store large amount of financial data. For large enterprise, to keep all the financial data and information is very difficult, but with the use of various accounting software, it has become easy and convenient.

On the other hand, the small & medium enterprise segment is anticipated to account for a major market share in the coming years due to rapid growth in new small & medium size enterprise around the globe. New affordable accounting software for small & medium size enterprises can help to boost the segment in the global accounting software market.

Type Segment Analysis

Based on type, the global accounting software market is segregated into enterprise accounting software, commercial accounting software, spreadsheets, and custom accounting software. The commercial accounting software is expected to grow at significant rate. The commercial accounting software is used for almost any business. Rising use of accounting software in almost every business to keep the all the financial data of the business.

Commercial accounting software offer customization as per the need of different businesses and organizations. Spreadsheet segment to register considerable CAGR during the forecast period. A spreadsheet is computer program that is widely used for computation, storage, and analysis of data in tabular form.

Spreadsheet provides several functions such as for performing complex mathematical calculations which are essential for accounting. It also offers easy tracking of payments and connecting different worksheets. Microsoft Excel is a widely used spreadsheet in the accounting sector which is used to make numerous calculations and it offers other options such as financial forecasting data.

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Deployment Method Segment Analysis

Based on deployment method, the global accounting software market is bifurcated into on premise and cloud segment. The on premises segment accounted the major market share in 2021. The on premises segment is expected to grow at significant rate owing to the several advantages of this segment. On premises accounting software is a software which is installed on local server along with the financial database.

Most of the enterprises prefer the on premises segment due to less data breach and high-end security compared with the cloud-based segment. On the other hand, cloud-based segment to register a considerable CAGR owing to the rise in adaptation of cloud-based accounting software. Cloud-based accounting software enables mobile access at any time.

Clients can access their data and accounts at any time and from anywhere. Cloud-based offer scalability and customizations as per clients’ demand. Moreover, cloud-based accounting platforms reduces manual work by automating banking tasks and accounting. Low cost and easier maintenance of the cloud-based segment can boost the global accounting software market.

End User Segment Analysis

Based on end user, the global accounting software market is segmented into the IT & telecommunications, BSFI, retail & E-commerce, manufacturing, healthcare, government & public sector, and others. BFSI segment is expected to expand at significant rate in the coming years. Accounting software is widely used in Banking, Financial Services, and Insurance (BFSI) segment.

Accounting software is crucial component of the banking sector as it keeps all the financial records to generate reliable and accurate information and reports as per the need of customers. Finance services and insurance sector also use various accounting software to keep the transaction history of their clients.

IT & telecommunications to register the considerable CAGR during the forecast period due to rapid growth in IT & telecommunication sector in the developing countries. Accounting software is used in IT & telecommunication sector to keep the systematic record of company’s financial information.

Regional Analysis

In terms of regions, the accounting software market is classified as Asia Pacific, North America, Latin America, Europe, and Middle East & Africa. The market size of North America is expected to dominate the market during the projected period due to the presence of strong & prominent players and initiatives taken by the governments to increase the use of accounting software in private and public sector. Early adaptation of advance technologies in the region can help to expand the global accounting software market in this region.

However, the market of the Asia Pacific is anticipated to expand at a rapid pace during the forecast period owing to the increasing adaptation of cloud computing software in the region. Due to the increasing IT & telecommunication sector in emerging economies such as China and India, rapid growth in using the accounting software can boost the market growth.

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