Petal launches new card for those with poor credit, refreshes old card

Posted: 1 October 2020 12:00 pm

A new option for those who didn’t qualify for the original Petal Card.

Today Petal launched a new credit-building card while refreshing their old offering. The new Petal 1 “No Annual Fee” Visa Credit Card gives those with poor credit a chance to rebuild their credit score for no annual fee. Meanwhile, the old Petal Card has been rebranded the Petal 2 “Cash Back, No Fees” Visa Credit Card, serving as the traditional no-fee rewards option for those with good or no credit.

Petal Cards Breakdown

Petal 1 “No Annual Fee” Visa Credit CardPetal 2 “Cash Back, No Fees” Visa Credit Card
Annual fee$0$0
APR19.99% to 29.49% variable12.99% to 26.99% variable
FeesLate fees: up to $40

Returned fees: Up to $29

Credit limit$500 – $5,000$500 – $10,000
RewardsUp to 10% cash back from select merchants1% cash back on all purchases

1.5% cash back on all purchases after making 12 on-time payments

Up to 10% cash back from select merchants

Credit score required550 or higherNo credit score required

Low credit scores may qualify for the Petal 1 instead

Which Petal card is for you?

Petal’s original card had two goals: to offer those with no credit who were “credit invisible” a good option for building credit, and to offer a fee-free, consumer friendly alternative to the majority of cards on the market. The only catch was those with poor credit couldn’t qualify for the card.

Petal’s new Petal 1 fixes this problem by allowing those with credit scores as low as 550 to apply. And Petal’s new application will evaluate applicants for both cards, assigning consumers to the card that’s the best fit for their finances.

Both cards are for building credit, though you’re most likely to qualify for the Petal 1 if you have a prior poor credit history.

How does the Petal 1 stack up to other credit building cards?

The Petal 1 is a bit of a rarity for a credit-building card because it’s an unsecured credit card. Many of the top credit-building cards on the market are secured and thus require a security deposit. Here’s a side-by-side comparison of the Petal 1 and another top credit-building card, the Discover it Secured.

Petal 1 “No Annual Fee” Visa Credit CardDiscover it Secured
Security depositNone$200 minimum
Annual fee$0$0
APR19.99% to 29.49% variable22.99% variable
FeesLate fees: up to $40

Returned fees: Up to $29

Late fees: up to $40

Returned fees: up to $40

Balance transfer fees: 3%

Cash advance fee: The greater of $10 or 5%

Credit limit$500 – $5,000$200 – $2,500 (dependent on your security deposit)
Signup bonusNoneAt the end of your first year, Discover will match all cash back you earned with no limits
RewardsUp to 10% cash back from select merchants2% cash back on a combined $1,000 in spending on gas stations and restaurants each quarter

1% back after that and on everything else

Credit score required550 or higher300 or higher

There are some distinct tradeoffs between these two cards. While the Discover it Secured has more forgiving credit requirements, your credit limit on average will be lower than the Petal 1. What’s more, you’ll need to front the cash as a security deposit for whatever limit you decide upon. On the upside, the Discover it Secured does have a more robust reward program, which is rare for a credit-building card.

The Petal 1, on the other hand, is slightly more difficult to qualify for but requires no security deposit whatsoever, has few fees and offers a much larger credit limit out of the box. Both are solid cards, though your existing credit score will play a role in which card is more appropriate for your needs.

What’s the catch?

The Petal 1’s consideration of applicants with poor credit comes at a cost: the card doesn’t feature the same fee-free structure as the Petal 2. Instead, the card features two types of fees: late fees and returned payment fees. The Petal 1 also lacks the flat rewards offered by the Petal 2, though it still offers the accelerated rewards on select merchants.

Though this is unfortunate, it’s understandable. Petal needed some way to balance out the higher risk associated with those with poor credit histories. Even with these fees, the Petal 1 is still a great option for credit rebuilding, as consumers won’t need to worry about a security deposit to open their account or annual fees to keep the account open.

Check out Finder’s Petal 1 review for more information on how this credit rebuilding card performs, as well as our updated thoughts on the Petal 2.

Correction: An earlier version of this story incorrectly stated the late fee for the Petal 1 “No Annual Fee” Visa Credit Card. It is $40, not $49. Our story is updated to reflect this fact.

Photo: Supplied

Ask an Expert

You are about to post a question on

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked provides guides and information on a range of products and services. Because our content is not financial advice, we suggest talking with a professional before you make any decision.

By submitting your comment or question, you agree to our Privacy and Cookies Policy and Terms of Use.

Questions and responses on are not provided, paid for or otherwise endorsed by any bank or brand. These banks and brands are not responsible for ensuring that comments are answered or accurate.
Go to site