Many aspiring bank card customers face a chicken-and-egg downside. You want a credit score rating, and a good credit score rating generally, to qualify for many bank cards. Nevertheless it’s exhausting to determine and construct credit score with no bank card.
The Petal® 2 “Money Again, No Charges” Visa® Credit score Card provides a means round that. It’s an unsecured cash-back bank card that doesn’t require a FICO rating as a situation of approval. Which means it’s a perfect first bank card for candidates who don’t need to tie up their cash in a secured bank card.
The Petal 2 card isn’t proper for everybody, although. Take into account the entire bundle earlier than you apply.
What Is the Petal 2 Card?
The Petal 2 “Money Again, No Charges” Visa Credit score Card is a rewards bank card designed for first-time bank card customers and others who’ve had problem qualifying for unsecured bank cards within the current previous. If you happen to’re new to credit score or your credit score historical past is restricted sufficient that you just don’t but have a FICO rating, you should still qualify for this card primarily based on earnings and different noncredit elements.
Petal 2 has an easy cash-back rewards program that earns as much as 1.5% again on on a regular basis purchases and as much as 10% again on purchases with choose retailers. It has no annual charge and only a few different charges.
Petal 2 does have a excessive common APR and no 0% intro APR promotion, so it’s essential to repay purchases in full every month.
What Units the Petal 2 Card Aside?
It ought to already be clear that Petal 2 shouldn’t be your typical bank card. It stands out from most others in a number of key methods:
- Doesn’t require a FICO rating for approval. When you’ve got a credit score rating, Petal considers it once you apply. However should you don’t, that’s not a deal-breaker. Petal merely makes use of noncredit elements to evaluate your utility, like your earnings and employment standing.
- As much as 10% again on eligible purchases. Petal 2 caps cash-back earnings at 1.5% on most purchases, but it surely companions with choose retailers (and extra on a regular basis) that provide 2% to as a lot as 10% again on eligible purchases.
- Potential for a excessive credit score restrict. For an entry-level bank card, Petal 2 has an unusually excessive most credit score restrict — as much as $10,000. Your particular credit score restrict relies on your earnings and employment standing, however should you earn good cash, you’ve much more leeway with this card than with most of its shut rivals.
- Common cash-back earnings primarily based on cost historical past. You earn 1% money again on most purchases to begin. As you construct up a historical past of well timed funds and accountable use, your common cash-back price will increase to 1.5%. That’s a transparent incentive to make use of this card correctly.
Is the Petal 2 Card Legit?
Sure, the Petal 2 Card is authentic. Although most individuals aren’t acquainted with the Petal title, Petal 2 is backed by WebBank, an FDIC-insured U.S. monetary establishment that has been in enterprise for years. The cardboard works like every other bank card backed by a U.S.-based financial institution.
Key Options of the Petal 2 Card
Petal 2 has rather a lot in frequent with different rewards bank cards: a cash-back program with guidelines it pays to study, a credit score restrict primarily based on customers’ capability to repay purchases, and a easy charge schedule. Its utility requirements throw some curveballs, however they’re simple sufficient to grasp.
Money-Again Rewards
Petal 2 earns 1% again on all eligible purchases. After 12 months of well timed funds and accountable credit score use, which means you keep inside your credit score restrict, the speed bumps as much as 1.5%. There’s additionally bonus money again on purchases with choose taking part retailers. The bonus price ranges from 2% as much as 10%, relying on the service provider. The lineup is all the time altering, however some very talked-about manufacturers take part, together with Costco and Adidas.
After every assertion deadline, Petal routinely redeems your cash-back rewards to your linked checking account. You don’t need to provoke the redemption course of.
Ongoing APR
From the day you open your account, all purchases you don’t repay by the due date accrue curiosity at 17.74% to 31.74% (variable) APR. That’s the next ongoing APR than most competing bank cards, so it’s much more essential that you just repay your Petal steadiness in full every month.
Essential Charges
Petal 2 has no annual charge, late charge, returned cost charge, or overseas transaction charge. Different charges could apply for particular actions like steadiness transfers, however there’s no ongoing price to make use of this card.
Credit score Restrict & Enhance
Petal 2 bases your preliminary credit score restrict in your credit score rating (when you’ve got one) and your potential to pay your assertion steadiness, which relies on your earnings. Preliminary limits vary as excessive as $10,000, although most new cardholders get accredited at a lot decrease limits — just a few hundred to some thousand {dollars}.
In case your preliminary restrict is low, Petal 2 provides a transparent path to the next credit score restrict by its Leap program. The deal is easy: You earn a credit score line improve after six months of qualifying on-time funds.
Credit score Required
Petal’s underwriting requirements are relaxed. When you’ve got a FICO rating, you’ll doubtless qualify with a rating as little as 600.
If you happen to don’t have a FICO rating, Petal doesn’t take into account your credit score historical past in any respect, as a substitute utilizing noncredit elements like earnings and employment standing. The upper your earnings and the longer your employment historical past, the higher your probabilities of qualifying with no credit score rating.
Benefits
Petal 2’s largest benefits move from its enchantment to rookie candidates and its comparatively beneficiant rewards program. For instance, it:
- Requires no credit score rating to get accredited. Petal 2 is without doubt one of the few unsecured bank cards that requires no credit score rating to get accredited. In reality, all else being equal, it’s simpler to qualify for this card when you’ve got a gentle job and no credit score rating than when you’ve got a gentle job and a really low credit score rating.
- Requires no safety deposit. As an unsecured bank card, Petal 2 requires no safety deposit as a situation of account opening. If you happen to’re nonetheless residing paycheck to paycheck or near it, this undoubtedly heightens Petal 2’s enchantment.
- Has potential for a excessive preliminary credit score restrict. Petal 2 is uncommon amongst bank cards marketed to first-time customers for providing excessive preliminary credit score limits to certified candidates. In case your earnings and employment standing permit, you possibly can qualify for a credit score restrict as excessive as $10,000 proper out of the gate with Petal 2.
- No annual charge. Petal 2 has no annual charge. It prices nothing to maintain this card in your pockets, irrespective of how occasionally you employ it.
- As much as 10% money again with choose retailers. Petal companions with choose retailers to supply as much as 10% money again on Petal 2 purchases. Some companions are fairly standard, amongst them Costco and Sam’s Membership.
- No late or returned cost charge. Petal 2 fees no charges for late or returned funds, although repeatedly lacking or bouncing funds may result in account closure.
- No overseas transaction charges. Petal 2 fees no charges for worldwide transactions. That’s excellent news for customers who journey outdoors the USA repeatedly.
Disadvantages
Petal 2’s downsides embrace its excessive price to hold balances and an absence of any promotions for brand spanking new cardholders.
- Excessive ongoing APR. Petal 2’s variable APR (presently 17.74% to 31.74%) is greater than most competing playing cards. If you happen to plan to hold a steadiness from month to month, search for a low-APR bank card as a substitute.
- No sign-up bonus. Petal 2 has no sign-up bonus for brand spanking new cardholders. There are many entry-level bank cards that do, in order that’s a notable draw back.
- No 0% intro APR promotion. Petal 2 additionally has no 0% intro APR promotion for purchases or steadiness transfers. Mixed with the excessive ongoing APR, that makes Petal 2 applicable just for individuals who plan to repay their balances each month, starting in month one.
- Low baseline cash-back price. Petal 2’s baseline cash-back price tops out at 1.5%, and solely reaches that threshold after a 12 months of accountable use. The Citi Double Money Card, one other no-annual-fee cash-back card, has a flat 2% return on spending.
How the Petal 2 Card Stacks Up
Your powers of deduction have little doubt led you to conclude that Petal 2 shouldn’t be the one card within the Petal household. And also you’re appropriate — there’s additionally a Petal 1, identified formally because the Petal 1 “No Annual Payment” Visa Credit score Card.
Petal 1 has a good quantity in frequent with Petal 2, and each are applicable for individuals with restricted credit score histories. However they’re totally different sufficient to warrant an in depth head-to-head comparability.
| Petal 1 | Petal 2 | |
| Ongoing Rewards | None | As much as 1.5% |
| Bonus Rewards | As much as 10% | As much as 10% |
| Credit score Restrict | As much as $5,000 | As much as $10,000 |
| Annual Payment | $0 | $0 |
| Secured | No | No |
| Requires FICO Rating | No | No |
Remaining Phrase
The Petal 2 Card is without doubt one of the greatest entry-level cash-back bank cards available on the market. Notable advantages embrace the chance to earn as much as 10% again on choose purchases, a nontraditional framework that requires no FICO rating, and the potential for top preliminary credit score limits.
Petal 2 isn’t good, although. It has no sign-up bonus or 0% intro APR promotion for brand spanking new cardholders, mediocre-at-best 1.5% base money again, and a excessive ongoing APR. If you happen to’re in search of an above-average return on on a regular basis spending or a beneficiant incentive to make massive purchases throughout your first months as a cardholder, you are able to do higher elsewhere — should you can qualify for a extra beneficiant card. If not, Petal 2 is your stepping stone to get it.
