Join us at Transfer 2025 to hear how industry leaders are building payments infrastructure for a real-time world.Register Today →
Batch processing is a method of processing various types of transactions. As the name suggests, transactions are processed in a group or “batch.” While batch processing infrastructure can require time, money, and employee training to get up and running, once integrated into a business it is generally a reliable, behind-the-scenes function.
Batch processing can be completed at any time, but it is most often used for end-of-period transaction processing such as bi-weekly payroll, end-of-business-day banking reports, or quarterly or annual financial statements. Automated Clearing House (ACH) Network payments also utilize batch processing.
The History of Batch Processing
Around 1890, US Census Bureau statistician Herman Hollerith first developed the idea for the punch card, to help calculate census data. Manually fed one-by-one into an electromechanical device, the data “punched” into each card would be read by the device. 50 years later, the punch card became the foundation for the idea of batch processing. Punch cards were organized into decks—or batches—to be processed all at once.
Herman Hollerith patented his punch card reading device as a “Electronic Tabulating Machine.” Later, he joined forces with a group of other inventors who collectively formed the Computing-Tabulating-Recording Company (CTR)—the CTR went on to become International Business Machines, otherwise known as IBM.
How Does Batch Processing Work?
Batch processing is a cost-effective way to handle large quantities of data all at once. For a real-world example, consider your cell phone bill. While it is possible that your cell phone provider manually calculates, processes, and sends you your bill each month, it is much more likely that they use batch processing to process and send bills to all of their customers at once, each month.
Batch processing jobs are usually run on regular intervals—overnight, bi-weekly, monthly, annually, etc.—but they can also be run as one-offs or as-needed. Batch processing systems are able to function at any time of the day or night, meaning jobs can be run outside of regular business hours or run during periods of down-time.
One major benefit of batch processing is that it doesn’t require any user interaction once it has begun (unlike transaction processing which requires transactions to be processed manually and one at a time). The hands-off nature of batch processing allows workers to maximize their time focusing on other aspects of their jobs. If a problem happens to arise with a batch processing job, an alert can be sent to let employees know that the job requires their attention.
Try Modern Treasury
See how smooth payment operations can be.
Learn
Payment operations is an umbrella term that refers to the entire lifecycle of money movement for a company.
Bank reconciliation is the process of verifying the completeness of a transaction through matching a company’s balance sheet to their bank statement.
A banking API is software that facilitates a digital connection between a company and a bank.
The term "cash position" pertains to the quantity of cash or assets that can be readily converted to cash, held by an individual, company, or financial institution at any given moment.
Continuous accounting is the ongoing process of updating a business’s general ledger with reconciled bank statement transactions as soon as they become available.
Fiat money is a form of currency issued by a government and declared legal tender, though not backed by a commodity.
Financial reporting empowers businesses to make informed financial decisions by identifying trends and tracking performance. It also offers insights into a company's assets, liabilities, and debt management strategies.
The Flow of Funds is the movement of money in and out of bank accounts.
Gross merchandise volume (GMV), also known as gross merchandise value, is the total value of the goods or services retailers sell over a set period.
An invoicing API allows companies to create, send, manage, and reconcile invoices, as well as track related payments end to end.
Know Your Business (KYB) is a set of verification procedures that helps companies avoid getting into business with criminals.
Month-end close is a critical process where the accounting team reviews and records financial transactions to close out the month.
Payment operations is an umbrella term that refers to the entire lifecycle of money movement for a company.
While both are essential for managing online transactions, there are several differences between payment processors vs. payments gateways.
Two options for financial transaction settlement—differing in both speed and style—here, we’ll look at how both Net Settlement and Gross Settlement work in action.
Incoming payment details are notifications that a company is going to receive a payment it didn’t originate—meaning the receiving funds were not initially requested.
Payment controls help accounts payable (AP) departments avoid losing money due to fraud, late payment fees, and other errors. They are a necessary part of a company’s overall payment operations to keep payments secure, accurate, and authorized.
Payment rails are the underlying systems and networks that facilitate the movement of funds between parties in financial transactions.
Account-to-Account (A2A) banking, sometimes also called Me-to-Me banking, is the transfer of funds from one account to another account.
Implementing a multi-bank strategy is vital for companies looking to reduce risk exposure. In this article we explain how to reduce financial risk by implementing bank redundancy.
Batch processing is a method of processing various types of transactions. As the name suggests, transactions are processed in a group or “batch.”
In business terms, float refers to the time delay between the movement of funds from one account to another.
The “Check Clearing for the 21st Century” Act, commonly known as “Check 21,” is a federal law enacted in 2004 to modernize the check payment system.
Electronic check presentment (ECP) is the process of electronically submitting a check to a bank for payment.
Know Your Customer or Know Your Client (KYC) is a set of guidelines for verifying the identity of a customer and gauging the associated risk of working with them.
Money transmission is the act of one party receiving currency for the purpose of sending it over to another party.
The 10-K is a comprehensive report mandated by the U.S. Securities and Exchange Commission (SEC) that publicly traded companies must file annually. This report provides a thorough overview of a company's financial performance over the past year.
A merchant’s bank account must pay an interchange fee to the card-issuing bank each time someone uses a credit or debit card to purchase something from their store.