Artificial Intelligence (AI) in Accounting Market Size, Share, Forecast & Trends by Component (Software, Services), Deployment (Cloud, On-Premise), Technology, Application (Automated Bookkeeping, Fraud Detection, Financial Forecasting, Auditing) - Global Forecast to 2035

AI-Powered Automation and Real-Time Analytics Revolutionize Global Accounting Industry Efficiency and Compliance

Market Summary

The global AI in accounting market was valued at USD 8.5 billion in 2024. This market is expected to grow at a robust 31.2% CAGR, reaching USD 169.9 billion by 2035 from USD 11.8 billion in 2025.

This rapid expansion is fuelled by the need for automation of routine book-keeping, enhanced fraud detection, and real-time financial analytics in enterprises of all sizes. According to an article published by KPMG, in December 2024, AI adoption within finance functions has surged considerably, with estimates suggesting a 62% increase in the U.S. companies integrating AI to a substantial extent in their financial operations. Notably, 58% are actively piloting or rolling out generative AI applications, while 52% have embedded AI tools specifically for financial reporting tasks. Rising regulatory complexity, such as SOX enhancements in the U.S. and the implementation of IFRS 17 globally, drives demand for AI-powered compliance and reporting tools. Moreover, on-premises solutions remain vital for highly regulated industries such as BFSI, which require stringent data restrictions. As companies prioritize digital transformation, AI in accounting stands as a strategic enabler for cost reduction and quick decision-making.

Competitive Scenario Insights

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AI in the accounting landscape is fiercely competitive, with global technology powerhouses such as IBM, Oracle, Sage, Intuit, and Xero leading product innovation and market share. Cloud majors and AI specialists are forging alliances, while agile startups like Botkeeper and Vic.ai are disrupting with AI-first platforms. Competition is marked by M&A, rapid feature releases, and strong service differentiation. For instance, in May 2024, Oracle Corporation and Accenture signed a strategic partnership intended to accelerate the integration of GenAI in financial operations. This collaboration further aims to support firms in maximizing their data value using of Oracle Cloud Infrastructure (OCI)-based GenAI model.

Recent Developments

Sage Group and AWS AI collaboration powers AI innovation in accounting and compliance

In May 2025, Sage collaborated with Amazon Web Services to improve its suite of AI-powered accounting technologies, employing AWS Bedrock and Trainium for rapid, more accurate forecasting and compliance. By leveraging AWS AI tools, Sage has enabled accelerated advancement, scale innovation, and provided AI-based solutions more efficiently.

Tellen AI Studio launched advanced accounting functions

In November 2024, Tellen launched its Accounting AI Studio by partnering with three U.S. firms, allowing natural language-based tailored AI application development tailored for advancing accounting workflows.

Key Market Drivers

1. Rising Demand for Financial Automation & Accuracy: The demand for automated financial processing is a key growth driver. Businesses face escalating transaction volumes and data complexity, making manual accounting methods untenable. According to a recent report, in 2024, companies have made substantial progress in experimenting with the use of AI for financial planning (78%) and accounting (76%). Additionally, around 45% firms reported that they are using AI for other financial operations, including tax accounting.
2. Cloud Integration Unlocks Scalability & Collaboration: Cloud-based accounting solutions are foundational in democratizing AI adoption, facilitating real-time data sharing, and agile system updates. Inherent advantages in scalability, security, reliability, and cost savings are the primary factors driving this overwhelming preference for cloud-based solutions. By providing businesses with unparalleled visibility and insights, cloud-based AI-enabled accounting solutions are revolutionizing financial management in comparison to conventional accounting methods. These solutions excel in the automation of manual tasks, including data entry and financial transaction processing, thereby reducing workloads and improving accuracy. In areas such as data management, tax compliance, decision support, and fraud detection, the capabilities of cloud accounting services have been further enhanced by the integration of AI. Such deployments drive collaboration and continuous innovation, particularly for distributed and remote workforces.
3. Regulatory Compliance & Fraud Detection Imperatives: Amid rising regulatory scrutiny, AI adoption has surged to ensure compliance and combat sophisticated financial fraud. AI algorithms enable early detection of anomalies, reducing financial fraud risk. Also, the new standards IFRS 17 (2023) and SOX 404 updates (2024) mandate detailed disclosures and transparent audit trails. According to the IIF-EY annual report, published in 2023, 87% of all respondents surveyed were either using financial and non-financial regulators/supervisors in their AI techniques or were planning to use them within the next 12 months. This supports not only risk mitigation but also transparency in financial reporting, fostering investor confidence.

Key Market Restraints

1. High Initial Investment & Change Management: Despite long-term ROI, implementing robust AI solutions requires significant upfront capital investment, including software licensing, data migration, and workforce training. Many SMEs cite cost apprehension and resistance to workflow transformation as notable barriers, slowing full-scale adoption in resource-constrained settings.
2. Data Privacy & Security Concerns: Rising regulatory focus on data residency and privacy (GDPR, CCPA) means companies must invest in compliance-heavy architectures. GDPR, CCPA, and sector-specific regulations (e.g., HIPAA) demand strict data handling. Around 58 % of finance leaders delay AI projects over data-sovereignty fears.

Table: Key Factors Impacting Global AI in Accounting Market (2025–2035)

Base CAGR: 31.2%

Regional Analysis

Regulatory Mandates and Cloud ERP Leadership Cement North America’s AI Accounting Dominance

North America retains a dominant position, capturing about 35-40% of the global AI in accounting revenue in 2025. The U.S. drives this leadership through a unique blend of technology investment, innovation, and robust regulatory frameworks. In 2025, more than 68% of American accounting firms implemented AI-driven solutions for routine book-keeping, reconciliation, and compliance, up from 52% two years prior. Public-private investments, notably AWS and Google Cloud’s incubator programs for accounting SaaS, speed AI’s integration into large firms and SMEs alike. Also, New Jersey CPA data shows mid-tier firms increased AI investments by 34% YOY, seeking workflow efficiencies and error reduction. The SEC and IRS have promoted digital transformation for improved transparency, further energizing automation adoption. Improved cloud infrastructure underpins real-time collaboration and secure data hosting, while partnerships between U.S.-based fintechs and accounting software firms accelerate practical AI deployment for analytics, reporting, and fraud detection.

National AI Strategies and Surge in Fintech Propel Asia-Pacific’s Accounting AI Market Growth

Asia-Pacific is the fastest-growing market for AI in accounting, with a projected CAGR of 38.5% through 2035. Rapid economic growth, digitalization, and SME proliferation distinguish China, Japan, Singapore, and India as core adopters. In China, ‘digital finance’ government initiatives have led to growth in cloud-based accounting deployments in 2024. Singapore’s Smart Nation strategy offers AI capability grants, driving adoption among both large multinationals and SMEs. The implementation of AI-driven accounting solutions is being spearheaded by countries such as China, Japan, and Singapore, with the support of government initiatives that encourage digital innovation. The vast opportunity for AI accounting solution providers is presented by the region's large population of small and medium-sized enterprises. As a result of the increasing emphasis on automation and efficiency in financial processes, the adoption of AI financial software has increased for a variety of tasks, including basic book-keeping and complex financial analysis. Additionally, the region's emphasis on the emergence of digital economies and smart cities has expedited the adoption of AI-powered financial solutions.

Country-level Analysis

Innovative Ecosystem and Collaboration Among Accounting & Tech-Firms Drive U.S. AI Accounting Leadership

The U.S. has established itself as a key player in the AI in accounting market, equating to approximately 80-85% share of the North American AI in accounting market in 2025. The country is a significant contributor to this growth due to its robust ecosystem of technology providers and accounting firms, high adoption rates of cloud-based solutions, in conjunction with its advanced technological infrastructure, which has fostered an optimal environment for the development of intelligent accounting software. For instance, in June 2025, EY announced that it is developing AI agents in collaboration with Nvidia to drive AI-powered engagement in the accounting field and tackle the dearth of accountants in the country. AI capabilities are being utilized by financial institutions and businesses throughout the U.S. to facilitate automated data entry, real-time financial reporting, and advanced analytics. Additionally, the country’s dedication to research and development in AI technologies continues to stimulate innovation in accounting applications, thereby establishing new benchmarks for the global market.

Government AI Roadmaps and Fintech Expansion Accelerate China’s AI Accounting Market

China’s AI in the accounting market is projected to grow at 43.5% CAGR through 2035, driven by the New Generation AI Plan (2023). Government-mandated digital record-keeping and aggressive incentives for AI adoption underpin robust market expansion. Leading firms (Kingdee, Yonyou, Alibaba Cloud) spearhead platform-as-a-service models, supporting 24/7 automated reconciliation, multilingual reporting, and tax optimization. Ant Group and Tencent Cloud embedded ML-powered invoice matching and risk analytics into their SME finance platforms in 2024, serving more than 10 million merchants. Strategic public-private initiatives have created a fertile ecosystem for AI accounting innovation, positioning China as both an APAC and global growth leader.

EU Regulatory Alignment and Industrie 4.0 Digitization Propel Germany’s AI Accounting Uptake

Germany holds a significant market share of around 25-30% in the European AI in accounting market in 2025. The German market is distinguished by a robust regulatory environment that ensures data protection and privacy while promoting the adoption of advanced technologies. The country has established a favourable environment for AI accounting solutions because of its emphasis on the development of digital innovation hubs and the promotion of technological advancement among SMEs. The competitive landscape that has been established by the presence of established accounting software providers and emerging fintech companies is a driving force behind the ongoing innovation of AI accounting solutions.   

Segmental Analysis

Software Dominates the Market Owing to Continuous Advancements and Increasing Adoption

AI in accounting market is primarily dominated by the software segment, which holds approximately 60-65% share of the total market in 2025. The substantial market presence is a result of the growing adoption of AI in accounting software that offers interactive features and improved customer search experiences with timely and relevant insights. These software solutions are transforming the process of tax preparation by assisting customers in identifying tax planning opportunities and streamlining a variety of accounting processes. For instance, in June 2025, Genpact announced the launch of its Genpact AP Suite, an agentic platform that offers autonomous, objective-oriented techniques using novel capabilities in document transformation, predictive analytics, and conversational AI. The segment's dominance has been further solidified by the integration of advanced virtual agents to enhance customer support journeys.

Cloud-Native AI Accounting Platforms Capture Market Share, On-Premises Serve Regulated Use Cases

The cloud segment has firmly established itself as both the leading and fastest-growing area within the AI-driven accounting landscape, capturing an estimated 75-80% market share in 2025. This dominant adoption is propelled by the inherent benefits of cloud platforms, including cost efficiency, scalability, robust security, and high operational reliability. Cloud-based AI accounting tools are transforming financial oversight by providing deeper analytics and enhanced transparency compared to conventional systems. These platforms streamline workflows by automating routine functions like data entry and transaction handling, which boosts accuracy and reduces administrative burden. For instance, in October 2024, Eleven launched a cloud-based AI-driven accounting tool, developed to optimize workflows, enhance project timelines, and allow firms to achieve milestones with greater accuracy. With AI integration, cloud accounting solutions now offer advanced capabilities in areas such as data governance, compliance, strategic decision-making, and fraud detection.

Report Specifications:

Market Segmentation

• By Component
  • Software
  • Services
• By Deployment Mode
  • Cloud-based
  • On-premise
• By Technology
  • Machine Learning & Deep Learning
  • Natural Language Processing (NLP)
  • Others
• By Application
  • Automated Bookkeeping
  • Invoice Classification and Processing
  • Fraud and Risk Management
  • Auditing and Compliance
  • Tax Management
  • Others
• By Organization Size
  • Large Enterprises
  • Small and Medium Enterprises

Key Questions Answered in the Report: