Do I need a separate service for transactional notifications?

Not always.

You usually don’t need a separate service for transactional notifications if:

• your app has low to moderate volume
• notifications are simple (email/SMS/push on key events)
• you’re okay sending them from the same backend that handles your core business logic
• you don’t need special deliverability, compliance, or retry guarantees

A separate service becomes useful when you need:

• reliability: retries, dead-letter queues, idempotency
• scale: large bursts of notifications
• channel management: email, SMS, push, in-app, etc.
• deliverability controls: dedicated IPs, domain reputation, bounce handling
• auditing/compliance: tracking what was sent and why
• decoupling: your main app shouldn’t block on notification sending
• template/version management: marketing and transactional templates handled cleanly
• multi-tenant or multi-brand support

Common approach

A lot of systems use a dedicated notification module or service rather than a fully separate product/service at first:

• Core app emits an event: order_paid, password_reset_requested
• Notification layer consumes it
• It decides channel, template, locale, retries, and delivery provider

Rule of thumb

• Startup / simple app: keep it inside your main backend, but use a queue/background job.
• Growing product: split notifications into their own service when sending becomes operationally important.

Good architecture baseline

Even if you don’t split it out, avoid sending notifications inline in request handling. Prefer:

• write business data
• enqueue notification job/event
• process asynchronously
• retry safely

If you want, I can help you decide based on your stack and expected volume.