In addition, as debit cards evolved, the major credit card companies and their banks began to issue a new type of debit card that operated through the existing national credit card networks. The use of these so-called signature-based debit cards has been growing rapidly for several years.
Another payment mechanism that was developed jointly by the private sector and the Federal Reserve was the automated clearinghouse, or ACH, system. The ACH system is a batch electronic payment system that has traditionally been used to process recurring credit and debit transactions, such as payroll payments, mortgage and utility payments, and government benefits.