Petal, a fintech business, launched a new credit card, the Petal 1 card, last week. The new card, like the original Petal Visa Card—now known as the Petal 2—is intended for folks with less-than-perfect credit. However, some of the conditions are less tempting than those of the Petal 2, and the firm has made it more difficult to get approval for the older card.
- Petal has introduced the Petal 1 credit card for consumers who wish to establish credit but have poor to fair credit and cash flow.
- The card allows you to receive cash back on some purchases, but not all.
- The older Petal Visa Card (Petal 2) is now geared for customers with fair to excellent credit or cash flow.
- While the Petal 1 isn’t as spectacular as the company’s original credit card, it’s still miles ahead of the competition.
How the Petal 1 Card Works
The new Petal 1 card is intended for persons with poor to fair credit or cash flow. There are no annual or international transaction fees with this card, however late or returned payment penalties may apply.
The Petal 1 also provides cash back benefits via the Petal Offers function, but only with certain retailers. These merchant offers are applied to your account immediately, and after you match the conditions, you’ll earn between 2% and 10% back. However, you will not get a continuing rewards rate on subsequent purchases.
Credit limits range from $500 to $5,000, based on your capacity to pay, prior credit limitations, credit history, and other factors.
Most notably, unlike many negative credit credit cards, the Petal 1 does not need a security deposit. So, whether you’re just getting started with credit or have made some errors in the past, the Petal 1 might be a terrific and cost-effective option.
Petal 1 vs. Petal 2
Petal made a big sensation in the credit card business when it released its first credit card in 2018. The Petal Visa Card—now known as the Petal 2—allows persons with no or minimal credit history to be authorized depending on how they manage their money.
People connect their bank accounts to Petal throughout the application process to demonstrate their income and spending, which Petal then uses to establish a “cash score.” To make a choice, the firm considers this information alongside (or without) your credit score.
Unlike many cards for those with bad credit, the original Petal card also included an excellent set of perks, such as up to 1.5% cash back and no fees.
In terms of target demographic, the Petal 1 card has taken its position, while the Petal 2 card is now aimed at persons with fair to excellent credit or cash flow. This will make it more difficult for certain folks to get.
The good news is that Petal 1 cardholders may progress to Petal 2 after demonstrating responsible card use over time. Until then, the Petal 1 is a great credit-building option to credit cards with exorbitant fees or upfront security deposits.
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