Cloud HR software is everywhere. But for some teams, especially in regulated industries, “just use the cloud” is not an option — an on-premise HRIS is the only realistic way to run HR securely.
If you work in banking, fintech, iGaming, healthcare, or other security-focused fields, you may have heard questions like:
- “Can we run this HR system on-premise?”
- “Is there an on-premise HRIS that is actually modern?”
- “How do we stay GDPR-compliant with HR data?”
This guide is for you. It covers:
- what an on-premise HRIS is and how it differs from cloud HR
- when on-premise HR software is a better choice
- how hybrid on-prem and cloud setups work
- what to look for in a GDPR-compliant HR system
- how HarmonyHR fits as a modern on-prem HR solution
Who this on-premise HRIS guide is for
This guide is intended for HR, People, and Security leaders in regulated or security-conscious companies, particularly in the banking, fintech, iGaming, and other high-risk industries.
At HarmonyHR, we focus on on-premise and private-cloud HR deployments, so we see where cloud-only HR tools fail security reviews and where an on-premise HRIS is a better fit.
What is an on-premise HRIS?
An on-premise HRIS is a human resources information system that you run on infrastructure you control — your own data centre or private cloud — instead of a vendor’s shared public cloud.
This gives you predictable data location, tighter security controls, and an easier path to meeting internal security policies, industry regulations, and GDPR requirements.
An on-premise HRIS is often described as on premise HR software, on-premise HRIS software, on-premise HRMS, in-house HRIS or self-hosted HR software. Some vendors also refer to these as on-premise HR solutions or on-premise applications — but the idea is the same: you keep HR data on your side rather than in a multi-tenant SaaS environment.
For many HR teams, this is the only way to meet:
- internal security policies
- client contracts
- industry regulations
- data residency and GDPR requirements
On-premise HR vs cloud HR: key differences
Let’s compare on-premise HR with typical cloud HR systems.
| Criteria | Cloud HR | On Premise HRIS |
|---|---|---|
| Data location | Stored in vendor’s cloud, often multi-tenant and possibly cross-border | Stored on infrastructure you control, in your data centre or private cloud |
| Security & compliance | You rely on vendor’s controls and shared certifications | Your security team enforces its own controls, audits, and monitoring |
| Customisation & integrations | Limited to vendor APIs and limits | Deep integrations with internal systems on your terms |
| Operating model | Subscription; vendor manages infra and updates | You/your IT partner manage infra; more work but more control |
| Total cost over 3 years | Depends on PEPM, add-ons, and growth | Often more predictable; may be cheaper at scale and in regulated environments |
Let’s look at the same differences in more detail.
Data location and control
- Cloud HR: data stored in the vendor’s cloud (often multi-tenant and sometimes outside your country or the EU).
- On-premise HR: data stored on infrastructure you control, in your own data centre or private cloud.
If you need to answer “Where exactly does our HR data live?”, on-premise HRIS gives you a clear answer.
Security & compliance
- Cloud: you rely on the vendor’s security practices and certifications, audits and penetration tests are often shared across many customers.
- On-premise: your security and compliance teams can enforce their own controls: network segmentation, custom encryption, local HSMs, SIEM, internal audits.
That’s why banks, payment providers, and gaming operators still ask for on-premise HR systems or hybrid on prem and cloud setups.
Customisation and integrations
- Cloud: integrations must follow the vendor’s APIs and limits.
- On-premise: allows your engineers to integrate HRIS with internal systems like access control, payroll, identity provider, and internal analytics on your terms.
Operating model
- Cloud: you pay a subscription, and the vendor manages infrastructure and updates.
- On-premise: you or your IT partner manage infrastructure, but you gain much more control over data, access and performance.
For some teams, this extra responsibility is a price worth paying.
When is on-premise HR better than cloud?
There is no single answer, but there are clear cases where an on-premise HRIS is a better fit than a cloud-only tool.
1. Regulated industries (banking, fintech, iGaming)
If you’re in banking or financial services, regulators and internal auditors often expect:
- strict control over access to HR data
- clear audit trails for sensitive actions
- predictable data residency within certain jurisdictions
An on premise HRMS or on-premise HR system makes life easier for HR teams in banking and financial services, iGaming and online gambling, fintech and payments, crypto, defence, healthcare and similar sectors where audits and security reviews are part of daily reality.
2. GDPR and HR data protection
HR data is some of the most sensitive personal data in your company.
With an on-premise HR system, it’s easier to design a GDPR-compliant HR system and processes:
- data stays in your controlled environment, with no cross-border transfers by default
- you can align your GDPR HR data policies (retention, access, subject requests) with the rest of your infrastructure
- a GDPR HRIS can connect to your existing DPO, logging, and consent frameworks
If you search for “gdpr hr system”, “gdpr hris”, “hris compliance”, you’ll quickly see the same theme: control over storage, processing, and access.
3. Security & “secure HR” requirements
Some companies have a rule against storing critical data in public SaaS.
For these teams, secure HR means:
- keeping HR data inside their own on-premise applications
- tightly integrating with internal authentication and access management
- being able to prove to clients and regulators that HR data is under strict technical control
In this context, a self-hosted HRIS is not just a “nice to have”—it’s a requirement
4. Hybrid on prem and cloud
In some organisations, the right answer is a hybrid on prem and cloud model:
- on premise HR software (HRIS, core employee database, sensitive documents)
- selected cloud tools for collaboration, performance, or learning
This approach lets you keep the most sensitive HR data in-house while using cloud apps where risk is lower and speed is more important.
If you work in iGaming and want to see how leadership and HR operations are changing, explore our guide: “iGaming leadership trends and how future Heads of People are built.”
When is cloud HR still a better choice?
Cloud HR systems are still a good fit in some cases.
For example, they work well for:
- very small teams without IT resources
- companies that do not handle highly sensitive data and trust standard SaaS security
- teams that want to avoid managing infrastructure.
If you do not have strict requirements for on-premise HR or GDPR-compliant HR data, a cloud HRIS can be enough. However, when regulators, auditors, or enterprise clients are involved, the situation changes.
If you use a cloud-only HR system and want to compare pricing and deployment options, our comparison guides can help:
→ BambooHR Alternatives & Competitors (2025)
How much does cloud HR cost vs an on-premise HRIS?
Pricing is a major factor in choosing between on-premise and cloud solutions.
Cloud HR tools usually charge:
- per employee, per month (PEPM)
- plus base fees and add-on modules
- plus implementation and premium support
If you’re wondering “how much does HR cloud cost?”, the short answer is: it depends on your headcount and the modules you use.
In contrast, some on-premise HR software and in-house HRIS options offer more predictable PEPM pricing, fewer add-ons, and sometimes one-time or no implementation fees.
If you are also considering outsourcing HR, you should compare the total cost of ownership over three years, not just the first invoice.
For typical cloud HR tool costs per employee, see our detailed HR software pricing comparison: “HR Software Pricing Comparison 2025.”
What to look for in a GDPR-compliant on-premise HR system
If you are looking at on-premise HR solutions, do not just ask if it is on-premise. Check for:
1. GDPR-ready data model
- clear data categories (like employee master data, payroll, medical or special categories)
- configurable retention policies for HR data
- support for data subject access requests (export, delete, anonymise)
Look for keywords in the documentation like GDPR HR system, GDPR HR data, GDPR HRIS, HRIS compliance.
2. Fine-grained access control
A serious on-premise HRIS software should support:
- role-based access control (RBAC)
- separation between HR, managers, IT, security, finance
- field-level or section-level permissions (e.g. managers see time off but not salaries)
This is especially important for secure HR in regulated sectors like banking and gambling.
3. Audit trails and logging
On-premise HR applications that handle sensitive data should provide:
- logs for important HR actions (view, edit, export, approval)
- easy export for audits and investigations
- integration with your SIEM / logging stack
4. Deployment flexibility
Finally, the best on-premise HR software offers flexible deployment options, including:
- fully on-premise HR deployment in your own data center
- private cloud or VPC setups for “near on-prem” control
- hybrid models that can connect with cloud apps if needed
How to implement an on-premise HRIS (beginner-friendly plan)
If you’ve only worked with cloud tools, the idea of an on-premise HR system might seem intimidating. But it doesn’t have to be.
Here’s a simple rollout plan for beginners.
Step 1: Map your current HR applications
Make a list of:
- where your HR data is stored now, such as spreadsheets, older HR systems, or payroll software
- which on-premise applications you already use
- which cloud HR tools you have, along with the data they hold
Step 2: Check your security, GDPR, and industry requirements
Work with your security, legal, and finance teams to answer questions like:
- Do we need to run HRIS on premise for compliance?
- Are there countries where HR data must be stored locally?
- Do any client contracts mention data residency or require avoiding multi-tenant SaaS?
This step will show if on-premise HR is just an option or a must-have.
Step 3: Define what you need from HR
List the features you want, such as:
- employee database
- time off tracking
- onboarding and offboarding
- document management
- e-signatures
- access and asset tracking
- reporting
This will help you choose between a single on-premise HRMS that covers most needs or a basic on-prem HRIS with some cloud tools.
If you’re still deciding whether to stay manual or move to an HRIS, start by looking at the bigger picture: “From Manual HR to HRIS: Why Smart Companies Choose HarmonyHR.”
Step 4: Pick an on-premise HRIS or a hybrid solution
Compare vendors based on:
- deployment options (on-prem, private cloud, hybrid on prem and cloud)
- security features like role-based access, audit logs, and encryption
- GDPR support (data location, retention, data subject rights tools)
- total cost over three years compared to cloud HR
Step 5: Plan your migration and go-live
Move your existing HR data into the new system, set up roles and permissions, test with one location or department, and then roll out to everyone once your HR team is ready.
How HarmonyHR fits as an on-premise HRIS
HarmonyHR is a modern HRIS designed for security-focused teams, offering both on-premise and private cloud deployment.
It’s ideal for companies looking for:
- on premise HRIS
- on-premise HR software
- secure HR system for banking or iGaming
- GDPR-compliant HRIS
HarmonyHR delivers three main benefits:
1. You control where HR data is stored
You can deploy HarmonyHR on your own servers or in your private cloud, making it easy to align with your existing security, logging, and backup policies.
2. You control who sees what
You control access with detailed roles for HR, managers, IT, finance, and security. For example, managers can see their team’s time off and onboarding status, but not salaries or sensitive information.
3. You still get a modern HR experience
It includes a clean interface for employees and managers, structured onboarding and offboarding workflows, and reporting and analytics that support HR teams.
If you want to see what an on-premise HRIS can look like in 2025 without returning to outdated software, HarmonyHR is worth considering.
If you’re still exploring the HR software market, you can compare on-premise and cloud vendors here: Best HR Software in 2025: Top 10 HR Systems Ranked (Pricing, Reviews & Comparison Matrix)
Next steps
If any of these sound familiar:
- your security team often blocks new HR SaaS tools,
- you have strict GDPR or client requirements,
- you work in banking, fintech, crypto, or gaming and need secure HR,
then choosing on-premise HR software is more than a technical choice—it’s a strategic one.
You can:
- book a free 30-minute HarmonyHR demo to see an on-premise HRIS in action
- or request a pricing & ROI estimate to compare cloud HR with HarmonyHR for your team and locations
FAQ: On-premise HRIS and on-premise HR software
What is an on-premise HRIS?
An on-premise HRIS is a human resources information system that runs on your own infrastructure instead of a vendor’s public cloud. Your HR data stays on servers you control, either in your data centre or private cloud, which helps you meet strict security, compliance, and GDPR requirements.
When is on-premise HR better than cloud?
On-premise HR works best if you are in a regulated industry like banking, fintech, gaming, or healthcare, have strong internal security policies, or need to keep HR data in certain countries for GDPR or client contracts. In these situations, a secure on-premise HR system or a mix of on-premise and cloud gives you more control over where your HR data is stored and who can access it.
Is an on-premise HR system more secure?
An on-premise HR system can be more secure if your security team sets it up properly and connects it with your existing controls, such as network segmentation, SIEM, encryption, and backups. You have full control over HR data, access, and audit logs, which is why many teams looking for secure and GDPR-compliant HRIS still choose on-premise HR software.