Fancy a change? Okay, let's narrow down the subject — we're talking not about your lifestyle, but how you pay for it.

If you've grown tired of paying interest, late payment fees and a host of other card charges, you may want to consider using a prepaid card. This is an innovative way of getting a grip on spending because there's no way you're going to rack up additional costs for not settling your bills on time.

Just like a debit or credit card, it allows you to make purchases anywhere, anytime. The difference is that you don't carry your whole bank account with you. You don't owe any bank any money, and you only spend what you have.

Simply load it with enough cash and you're good to go for shopping. What's more, you don't even need to open a bank account to get one.

This payment solution has become fairly popular in other markets. Unfortunately, in the UAE, not much buzz has been generated around it.

So far, I know only two major banks offering prepaid cards here.

For decades, we have been supposed to be moving into a cashless world. As consumers increasingly want convenience, banks are now being prompted to create innovative prepaid card products.

Market

I think there's a huge market in the UAE. The population comprises mainly working expatriates in the low-income bracket who may not be suitable candidates for credit cards. Besides, there's a huge cohort of young spenders — teenagers and students — and regular consumers who shop when it suits them, particularly online.

However, if you decide to get a prepaid card, remember that nothing comes for free. As with any product, there are fees to watch out for.

A new prepaid card, marketed in the US, has recently entered the financial market. You must have heard about reality-TV stars the Kardashian sisters, whose show Keeping Up With the Kardashians reflects their opulent lifestyle.

Recently, they launched a prepaid debit card targeted at teens. It bears the Kardashians' photo and is being promoted as a way for parents to monitor their children's spending and teach them how to manage money at the same time.

However, the new card is getting flak for charging "predatory" fees. Card fees are pegged at $59.95 for six months or $99.95 for one year, plus $7.95 a month thereafter. And the fees don't stop there. There are charges for ATM withdrawals, cancellations and other services like talking live with a phone operator.

Lower fees

If you buy a prepaid card from a UAE bank today, chances are you will pay fees as well, but maybe not as much. One bank requires a Dh25 one-time fee for the prepaid card. The amount will be returned to you when you cancel your card. There are no annual or monthly fees, so far.

You don't pay any service or transaction fees if you use the card to purchase at any store in the UAE. However, you are likely to pay Dh10 every time you withdraw cash from any ATM machine, whether it's run by your prepaid provider or not. If you purchase online or abroad, the bank may charge a 2.25 per cent to 2.5 per cent fee.

If you think a prepaid card is good for you, tread carefully. Review the terms and conditions. Find out what the fees are.

While we don't expect banks to give away prepaid cards for free, since they also need to generate some revenues, the best product should have negligible and transparent fees.

If banks can successfully package it as a pro-consumer tool, coupled with exciting rewards for everyday purchases, it could be a win-win for everyone.