#transaction processing system

According to the research, 1.01 billion dollars in credit card transactions occur every day around the world in 2018. Now, the numbers are increasing day by day after the covid-19 wave.

Transaction Processing System helps to work in the real-time-based system. It is used in railway reservation systems, accounting systems, banking systems, etc.

There are different types of Transaction Processing Systems such as payroll, order entry, inventory control, accounts payable, etc.

Matter of fact, the Transaction Processing System is the major factor for the rise in the global economy.

What is a Transaction Processing System?

A Transaction Processing System is an information processing system that collects and stores data about business transactions and sometimes controls decisions made as part of a transaction. The transaction is the process of exchanging goods, services in terms of money.

Advantages of Transaction Processing System

1. Real-time processing

This system is based on real-time. It helps in the execution of data in a short period, providing near-instantaneous output.

Good examples of real-time data processing systems are bank ATMs, traffic control systems, and modern computer systems such as the PC and mobile devices.

2. Increase in productivity and customer satisfaction

If the system is fast, then it leads to an increase in productivity and customer satisfaction. And, the Transaction Processing System is also one the fastest systems.

3. Security

Security is one of the main key factors. Similarly, it helps to make good security of the users while doing multiple transactions.

4. Systematic

Simply, a part or unit of the system cannot work solely. It needs whole parts to work successfully.

Meanwhile, working successfully, it provides a systematic facility to the users.

What are the components of the Transaction Processing System?

1. Input

Source documents such as customer orders, invoices, purchase orders, etc. serve as Inputs to the Transaction Processing System.

2. Processing

Once the inputs are provided, they are further processed to get an output.

3. Storage

Ledgers serve as a source of storage. Examples of ledger accounts are cash, account receivable, inventory, fixed assets, accounts payable accrued expenses, debt, stockholders’ equity, revenue, cost of goods sold, salaries and wages, offices expenses, depreciation, and income tax expense.

4. Output

Any document generated is termed output.