Hybrid On-Chain and Off-Chain Architectures for Secure, Decentralized Fintech Payment Processing in SAP

The rise of decentralized finance (DeFi) technologies allows businesses to rethink financial processes centered around traditional centralized systems. However, direct on-chain integration with legacy platforms such as SAP incurs latency, cost, and compliance conflicts that are seldom aligned with the needs of enterprise-scale finance. This research proposes and assesses a hybrid architecture that integrates on-chain smart contract execution with off-chain approval and validation logic to enable secure, scalable, and auditable fintech payment processing within SAP environments. The architecture utilizes SAP FI transaction triggers such as FB60 or F110 to instigate payment workflows which are executed in part by blockchain nodes utilizing secure asynchronous handlers while retaining regulatory bounding and state finality within SAP.A testbed which simulated over 100,000 transactions per hour was set up on Quorum, Hyperledger Besu and Polygon Edge blockchains. The hybrid model was proven to outperform fully on-chain and legacy SAP models in transaction throughput, fault tolerance, and audit traceability by a significant margin. Latencies were also reduced by an average of 47% when compared to full-chain setups. The hybrid model was able to retain audit finality in the ledger and had a 94.8% success rate of settlement under Byzantine fault injections exerts while enduring sustained cross-system fault tolerance. Security layers placed on both chains and off-chain components block 98% of simulated attack vectors in the transaction path. In addition, the attack simulations showed over 37% reduced CPU resource consumption in hybrid mode compared to full-chain validated configurations. The results support the hybrid model's capacity to enable high trust decentralized financial operations within SAP while increasing structural performance, resilience, governance capabilities of the system.