Statistics such as this have led to calls for people to be educated on financial responsibility, and for such education to start young.
“Financial responsibility should ideally be inculcated at an early age, with young people being taught how to spend measured amounts of money, avoid unnecessary funds, and learn the importance of allocating expenditure to various needs and wants,” said Martin Waldenstrom, cashU, a prepaid online payment service provider that allows customers to make payments to online merchants safely and responsibly.
UAE teens spend more than three times the global average, according to 2010 research by Dubai market research firm AMRB, with twelve to nineteen year olds spending Dhs260 a week compared to the international average of Dhs77. The high figure can partially be justified using the UAE’s high per capita wealth: GDP per capita was estimated at over Dhs186,000 in 2010.
“The question isn’t whether young people in the UAE spend too much in absolute terms, but whether they have a responsible approach to money and controlling finances. It’s entirely possible that prolific spending without responsibility early in life might lead to people taking on personal debt later,” said Waldenstrom.
In 2008, UAE central bank figures suggested a surge in personal debt through loans and overdrafts, representing a 38% increase over 2007. The surge in debt was potentially driven by inflation coupled with a desire to maintain luxurious lifestyles. In 2008, the UAE’s daily per capita consumer spending was estimated at Dhs99, among the highest in the world.
“We believe it’s imperative that young people be allowed to spend money responsibly, but in ways that teach them the value of not overspending or reaching for credit at the first opportunity,” he added. “cash started its prepaid online payment services to allow young people to spend responsibly on entertainment, and we firmly believe that parents, guardians, educators and even businesses should help young people understand how to spend responsibly and also save.”
cashU is an alternative payment solution based on prepaid cards that can be used online with a very high level of security coupled with convenience. The prepaid cards are topped up through banks, or online exchanges. Because they can be topped up with specific amounts, they are emerging as a powerful tool for parents and guardians to meter money to young people, and promote responsible spending. cashU serves online shoppers all over the Middle East and Arabic-speaking world. The cards are available in over 4,500 POS across the Middle East, GCC and North Africa. The service is popular across multiple sectors such as gaming, matrimony, business and VoIP communication. cashU currently serves over 500,000 online users who make online payments to a network of 7,000 plus merchant sites.
“One of the distinct advantages of the cashU prepaid service is expedience in controlling spending. cashU must be topped up before making transactions, which allows funds to allocated at the start of the month, for instance. Transactions are not allowed when account funds run out, which means overspending, or spending on credit, is prevented. cashU customers will never have to face being credited with an amount they cannot repay,” Waldenstrom noted.
cashU doesn’t require the divulgence of personal details, which adds a further layer of security for young people. The payment platform is built on a highly sophisticated, up to date fraud prevention and AML systemthat allows safer and faster consumer participation in e-commerce.
Monday, February 6- 2012 @ 15:40 UAE local time (GMT+4) Replication or redistribution in whole or in part is expressly prohibited without the prior written consent of Mediaquest FZ LLC.