From the company who was “sick of credit card companies” comes Petal, which the company believes will be “your new favorite credit card.”
It’s the only credit card from the fledgling startup, but it promises to be different, and better than what you’ve come to expect from a piece of plastic.
Who Is the Petal Credit Card For?
First off, I should mention that the Petal credit card isn’t for everyone.
It’s actually intended for those who are building their credit history, or perhaps have bad credit.
But instead of being one of those shoddy, embarrassing credit cards you probably wouldn’t want anyone to know you had in your wallet, it’s cool.
It’s nice to look at and the company itself seems to be different too.
They look more like a tech startup than a credit card company, and do indeed rely on technology to improve their offering.
That includes a fancy, colorful app that tracks spending and helps you manage your money.
What Credit Score Do You Need to Get Approved for Petal?
Interestingly, you can get approved for Petal without a credit score (or credit history).
And they don’t require an upfront deposit if that’s the case, like comparable secured credit cards.
They also state simply that, “if you have a credit score we’ll look at it,” which infers that credit score requirements aren’t very high here if at all applicable.
However, they may impact what credit limit you may receive with the card.
But they claim to offer bigger limits than the competition too, which range from $500 to $10,000, versus $200 to $500 with the other guys.
Speaking of credit, the company also says you can see if you’re pre-approved for Petal without it impacting your credit. In other words, no hard pull.
If you’re pre-approved, you can apply, at which point they will conduct a hard pull and look at your credit report.
Not everyone will be approved – they mention those with checkered credit history, such as a history of missed payments and/or bankruptcy may not pass muster.
Petal Card Cash Back Rewards
The Petal card now comes with a cash back rewards program that grows as the cardholder makes on-time payments.
Initially, you earn a fairly standard 1% cash back on every purchase.
But after making six on-time payments, that cash back rate rises to 1.25%. And after a year of on-time payments, you’re earning a healthy 1.5% cash back.
While there are certainly better rewards credit cards, and several credit cards that earn 2% cash back, it’s a decent haul for a credit building credit card seeing that most don’t offer any rewards at all.
Petal Credit Card Fees
Now let’s talk about fees, something anyone with a starter credit card should be concerned with.
Unsurprisingly, Petal has thrown out all the fees too. There is no annual fee, no late fee, no over-the-limit fee, and no other fees of any kind.
I checked out the fine print and didn’t see any fees. If you do default (fail to make the minimum payment), they can suspend/cancel your account and declare the entire outstanding amount due, plus any associated costs.
They do note that credit card companies make money three main ways – via interest, cardholder fees, and merchant fees, also known as interchange fees.
Since they don’t charge their customers fees, they make money via those last two categories.
However, they note that if you don’t choose to pay your balance in full, they will clearly let you know how much it will cost you.
So there’s an effort to perhaps be more transparent than the other card issuers.
In terms of APR, they say it’s lower than most other “new-to-credit options” on the market.
That means the interest rate is competitive relative to other, similar cards, but maybe not cards for those with good/excellent credit.
Either way, you should make every effort to pay your balance off in full each month to avoid finance charges, as it never really makes to pay interest, even if the rate is a tad bit lower.
The Truth’s Take on the Petal Card
All in all, Petal appears to be a solid credit card for the new-to-credit cohort.
It’s rare for a card in this category to have any rewards whatsoever, so the fact that they’re offering 1% cash back and more over time is pretty generous.
Additionally, the credit limits seem to be higher than their peers, and their APRs lower, which should make both spending and saving easier.
The lack of fees is also a huge plus, and again a rarity for credit cards in this class.
Lastly, the Petal card seems to offer pretty good approval odds, meaning even though with no, limited, or poor credit may get approved.
The pre-approval option is also a great help because it allows you to get a good idea of full approval before actually getting a hard inquiry on your credit report.
Just remember that the Petal card is geared toward those new to credit, or with questionable credit history.
There are certainly better credit cards out there for those with excellent, good, and even average credit scores, so apply accordingly.
For the record, the Petal credit card is a Visa card issued by WedBank, an FDIC insured bank headquartered in Salt Lake City, Utah.