Transaction processing:
There are two ways in which the transaction processing systems process data - Real time processing and Batch processing.
Real time processing
Real time processing is also known as online transaction processing (OLTP). In real time processing, the transactions that occur are processed immediately. As the transactions are processed as and when they are generated, the output is also provided immediately to the company and to the end users. In real time transaction processing, the entry of data is done online. The operator has access to a database, which is located online. Therefore, any errors that might arise during the process can be rectified immediately.
Batch processing
In batch processing, the information that is gathered is stored but is not processed instantly. This type of transaction processing involves accumulation of transactions until a certain set of criteria are satisfied - such as time period (say monthly, quarterly) or quantity (based on the volume of transactions).
Both the transaction processing systems explained here are relevant in their own way depending on the situation and the requirement. For instance, a railway reservation system would require a real time processing of transactions. On the other hand, an employee payroll system would require a batch processing system based on the payroll frequency.
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