Online Transaction Processing Systems
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Advantages And Disadvantages of Online Transaction Processing Systems

Globalization and the Internet have transformed many aspects of our life. Now, all we need is a proper computer and an Internet Connection, and literally, there are not a lot of things you can’t do.

This includes the online financial transaction culture brought about by e-commerce websites. Anyways, it is not limited to selling or buying goods but has reached a whole new level (you can even hire someone to work for you – online).


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This degree of comfort, this level of confidence and security are all brought together by the online transaction processing systems. These systems handle several transactions other than financial, for example, surveys. Nowadays small to enterprise level web based and desktop applications are completely based on these online processing systems for their customers.


These systems handle several transactions other than financial, for example, surveys. Nowadays small to enterprise level web based and desktop applications are completely based on these online processing systems for their customers.

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In this article, we discuss the various advantages and disadvantages associated with several online transaction processing systems.

Online transaction processing systems (Advantages)

  1. Easy and best solution for online shoppers.
  2. These systems are most efficient and have excellent response times.
  3. Very easy to use; as simple as fill a form and the rest will be taken care of by the web and database servers.
  4. Online banking is completely based on online transaction processing systems.
  5. Credit cards are also well-handled by these systems.
  6. You can access anything on the web and choose to buy it because all financial transactions methods are supported by these systems.

Online processing systems (Disadvantages)

  1. At times, there occur millions and millions of requests at a time which gets difficult to handle.
  2. During purchases even if the servers hang for few seconds a large number of transactions get affected, in turn affecting the organizations’ reputation.
  3. Databases store all user data and account information, if these servers are hacked, it could lead to financial and personal problems (thefts).
  4. In the case of hardware failures of the online transaction processing systems, visitors of the website get in trouble and their online transactions get affected.
  5. Electricity problem is another issue, i.e., if there is a shortage in electric supply additional backup facilities like generators and related hardware, is a must.
  6. Online transaction processing involves a lot of staff working in groups to maintain inventory.
  7. These online transaction systems impose processing costs on the buyers and sellers as well.
  8. These systems do not have efficient methods of transferring products to buyers by themselves. That’s where the e-commerce websites come in.
  9. The fundamental of operation of online transaction systems is atomicity. Atomicity ensures that if any step fails in the process of the transaction, the entire transaction must fail, due to which the same steps have to be repeated again and again while filling forms which causes dissatisfaction among buyers.

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