Sequential files can be processed in SAP using READ DATASET and TRANSFER statements. Before reading from or writing to a sequential file, it must be opened using OPEN DATASET. Common options for opening include FOR INPUT, FOR OUTPUT, and FOR APPENDING. The file can be opened in either BINARY MODE or TEXT MODE. After processing, the file should be closed using CLOSE DATASET. Batch input (BDC) allows transferring large amounts of external data to SAP sequentially using batch programs without a user dialog. It simulates user input for validation and uses a queue file to group the data into sessions for loading into the SAP database.