Fault Tolerance in Critical Applications: The power of Erlang in Payment Systems

Fault tolerance is an essential characteristic of modern software systems, ensuring that applications remain operational despite hardware failures, software bugs, or unexpected crashes. In industries like finance, where payment systems process thousands of transactions per second, maintaining uninterrupted service is essential. |

Fault tolerance helps keep systems running smoothly, protects data integrity and ensures compliance with strict financial regulations.

In this article, we’ll explore some key strategies for building fault-tolerant systems–including cloud-based services, microservices architectures, container orchestration, and the powerful BEAM ecosystem. We’ll also dive into the unique challenges of payment systems and demonstrate why Erlang, with its proven fault tolerance features, is an ideal solution.

// Cloud-Based Fault Tolerance

Cloud providers such as AWS, Microsoft Azure and Google Cloud offer built-in mechanisms that are essential for maintaining service uptime—crucial for payment systems where even a short outage can lead to lost revenue and shaken customer trust. Some key features include:

Auto-scaling: Automatically adjusts resources to handle sudden spikes in transaction volumes.
Multi-region deployments: Ensures that if one data center experiences an outage, traffic is rerouted seamlessly to another.
Managed failover: Minimizes disruption by quickly shifting workloads in the hardware or software failures.

The cloud provides a powerful platform for fault tolerance, allowing developers to leverage scalable infrastructure to build resilient applications without worrying about hardware failure or capacity issues.

// Microservices and Redundancy

Another approach to fault tolerance is microservices architecture.

Microservices break down complex applications into smaller, independently deployable services that can communicate with each other. This design improves fault tolerance by enabling each microservice to be replicated and deployed across multiple instances. In the event of a failure in one instance, other replicas can continue to operate, minimizing the impact of the failure.

A great example of a fault-tolerant approach is using a microservices architecture in payment systems. Instead of relying on one large, monolithic application, the system is broken down into smaller, independent services. This setup offers several key benefits:

Isolation of failures: Each service handles a specific part of the payment process and can be deployed or scaled independently. If one fails, the rest keep running—so the platform stays functional.
Scalability: Services can scale based on demand, helping to process high volumes of transactions smoothly.
Improved redundancy: By removing single points of failure, microservices create a more resilient setup for critical financial operations.

This kind of architecture is especially valuable in payment environments, where even a brief outage can affect a large number of transactions.

// Kubernetes and Container Orchestration

Kubernetes, the open-source container orchestration platform, offers powerful tools for ensuring fault tolerance in cloud-native applications and plays a vital role in modern payment systems by ensuring continuous service availability. By managing containerized applications across distributed infrastructure, Kubernetes helps maintain service availability through self-healing, load balancing, and automated failover. Let’s take a closer look at it:

Self-healing: Kubernetes detects when a container fails or becomes unhealthy and automatically restarts or replaces it.
Load balancing: It spreads transaction requests evenly across containers to avoid overloading any single one.
Automatic failover: If something goes wrong, traffic is quickly rerouted to healthy containers to keep transactions flowing without interruption.

For even greater resilience, technologies like service meshes (e.g. Istio or Linkerd) can be used in conjunction with Kubernetes to manage traffic control, retries and circuit breakers–all of which are crucial when processing high-value, sensitive payment data. These tools allow developers to maintain seamless operations even in the event of service failures, ensuring that requests are still processed reliably.

// Payment Systems: Fault Tolerance to the Bone

While fault tolerance is important in all applications, certain critical systems demand it at the most granular level—on each individual request. Examples of such systems include payment processing platforms, online gaming services, messaging systems, stock trading applications, and emergency response networks. In these scenarios, any failure—whether caused by a software bug or a network outage—must not result in lost data or service disruption.

Payment platforms are among the most demanding applications when it comes to fault tolerance. In these systems, every transaction must be executed reliably, as any failure can result in significant financial loss or compromised data integrity. Consider some of the key challenges payment systems face:

High availability: They need to run around the clock, with zero tolerance for downtime.
Data integrity and security: Every transaction involves sensitive financial data, so accuracy and protection are non-negotiable.
Regulatory compliance: Systems must meet strict standards like PCI-DSS, which demand strong fault tolerance and fast recovery from any errors.
Quasi-real-time processing: Payments must be handled efficiently with minimal delay.

In such high-stakes environments, even a single process failure should not affect the overall system. This is where the BEAM ecosystem, powering Erlang and Elixir, demonstrates its true strength.

BEAM, the virtual machine used by Erlang and Elixir, is explicitly designed for fault-tolerant systems. Its lightweight process model and actor-based concurrency model allow independent execution of thousands or even millions of processes. Each process is isolated, so the failure of one process does not cause the failure of others. Erlang and Elixir’s fault tolerance and scalability make them ideal choices for high-availability systems.

// Erlang and the BEAM Ecosystem in Payment Systems

Erlang was designed from the ground up for building robust, high-availability systems. Its features are particularly well-suited for the demands of payment processing:

Massive concurrency: Erlang’s lightweight processes and actor-based concurrency allow a very large number of transactions to run at the same time, ensuring high throughput for real-time payment processing.
Fault isolation: Each process is isolated, so when one fails, it doesn’t affect the others. Thanks to Erlang’s “let it crash” approach and supervision trees, failed processes are quickly and safely handled, preventing issues from spreading.
Scalability: The BEAM virtual machine is designed for distributed computing, so as transaction volumes grow, Erlang-based systems can easily scale across multiple servers or data centers while maintaining low-latency performance.
Proven resilience: Erlang’s built-in fault tolerance has been tested in other critical industries, like telecommunications and messaging. This makes it a trusted choice for financial systems where reliability is crucial.

By leveraging BEAM’s strengths, developers can build payment systems that meet the high standards of modern finance while ensuring resilience to keep operations running smoothly, even during unexpected failures.

>>> Conclusion

Fault tolerance is essential for modern software, especially in critical areas like payment processing. By combining cloud-based solutions, microservices architectures, and container orchestration, developers can build resilient systems capable of handling high volumes and sudden spikes in demand.

Erlang—and by extension, the BEAM ecosystem—brings additional value by offering unparalleled concurrency, fault isolation, and scalability. In an era where downtime can lead to significant financial losses and regulatory penalties, the key to building fault-tolerant systems lies in selecting the right combination of technologies that best suit the specific needs of the application.

At Crafting Software, we choose to work with Erlang to deliver scalable and fault-tolerant payment systems, as we know that downtime isn’t an option in fintech. That’s why Erlang’s robust design allows us to develop systems that stay resilient under load, ensuring seamless and secure payment processing at all times, remaining reliable even under the most challenging conditions.

// Florin Bota // APRIL 10 2025