Abstract Power factor plays an important role in electrical industries. Low power factor results in loss of power and poor handling capacity. This factor can be overcome by using capacitors in parallel to the load. Since capacitor draws a leading while inductor draws a lagging current, hence by adjusting capacitor banks parallel to the load, it will level the power factor in the line. Earlier, the process of power factor improvement was done through manual connection of capacitor bank. Later a power factor corrector named the automated power factor corrector (APFC) was proposed. It uses a switched capacitor circuit to improve power factor. In this research, the power factor value from the load is measured and it also includes the installation of APFC unit using a PI controller. The design of this auto-adjustable power factor correction scheme is to ensure that the grid power system always operates under the specified power factor. Actual work of APFC is that it selects the capacitor bank for power factor improvement. The capacitor bank block will choose automatically to further improve the power factor. This process goes on until the required power factor is obtained. Later on, this will automatically turn off the connection between the capacitor bank and the circuit. Furthermore, power saving with power factor after improvement is also discussed in the paper. Here APFC plays a key role in order to decrease the time taken to correct the power factor, which is ultimately beneficial to increase the efficiency of the motors and all inductive loads.