In this Money Matters Report, Tara Lynn Wagner looks at prepaid debit cards and what you need to consider before you choose one.

More and more Americans are using prepaid cards as a payment method, loading them with hundreds of billions of dollars in 2014. They work just like a debit card.

"Only it's not attached to your bank account," says Margot Gilman, Money Content Development Team Leader at Consumer Reports.

Which explains why the cards first gained traction with the unbanked population.

"They couldn't afford the fees that were associated with maintaining a checking account, maybe they weren't eligible for a credit card,” Gilman says. “So prepaid cards grew popular among that group."

Gilman says their appeal has spread.  Parents give them to college kids as a way to limit their spending.  Others treat them as a personal budgeting tool. 

"So say you only want to spend X number of dollars a month on clothes, you can load a prepaid card with that amount of money and you are pro force stuck to that limit because you can't overdraw,” she says.

Despite their benefits, Gilman says consumers need to choose their card carefully.  First and foremost, compare the fees.

"There's a fee to buy it, there's a fee sometimes just to load money, to use an ATM, so different cards have different fee structures,” she says.

Consumer Reports recently ranked prepaid cards in two categories - those used in conjunction with a bank account and those used as a substitute for one.  In addition to cost, they looked at safety features, value and convenience.

"For instance any card that's branded Visa or MasterCard is going to be more widely available than say a card that's branded Amex,” Gilman says. “Amex cards are just accepted less widely." 

On the whole, Consumer Reports found prepaid cards are getting better than when they were first introduced. Fees are lower and transparency is greater. But they say there's still room for improvement."

Some cards, for instance, voluntarily offer extra security like FDIC insurance or protection against fraud - measures Consumers Union would like to see expanded.

"So that they are safer to use for all consumers," Gilman says.

The Consumer Financial Protection Bureau is expected to issue new regulations on prepaid cards this year.