To reduce the size; and to reduce maximum electric power in a paper processing system having the paper cutting function.

This paper processing system is provided with a paper carrying-in port 55 arranged on one side surface, a saddle stitching paper discharge port 56 arranged on the other side surface on the opposite side of this paper carrying-in port 55, a saddle stitching compiling tray 21 extending below the other side surface side from above this one side surface side and registering-housing a plurality of paper carried in from the paper carrying-in port 55, a saddle stitching stapler 24 for binding a prescribed part of a housed-registered paper bundle, a folding knife 25 for folding up a bound paper bundle, a rotary cutter unit 30 arranged in the vertical upward direction of the saddle stitching compiling tray 21 and cutting folded-up paper by using a blade for moving in the horizontal direction and a booklet tray 51 for loading the paper cut by this rotary cutter unit 30 and discharged from the saddle stitching paper discharge port 56.