Petal® 2 "Cash Back, No Fees" Visa® Credit Card Review
Petal® 2 "Cash Back, No Fees" Visa® Credit Card
CardRatings Editor's Analysis: Pros & Cons
- Usually those with no credit history are limited to secured credit cards, which rarely offer rewards. This card is great for anyone looking to build their credit while also earning rewards, with up to 1.5% cash back on all purchases.
- Reporting to all three major credit bureaus to help build a credit score.
- No fees of any kind, including no annual fee, no late payment fee and no foreign transaction fee.
- This is a card for people with no credit history - not poor credit. If you have significant delinquencies or a bankruptcy on your record, you may not be approved.
Petal® 2 essentials
Until now, credit card options for those without a credit score were limited. In many cases, people had no choice but to make an upfront deposit for a secured credit card. Or, if they were approved for an unsecured card, their spending limit may have been very low. However, the new Petal® 2 changes all that.
The Petal® 2 is ideal for those who have solid money management skills but no credit history. Applicants without a credit score can link to their bank account to prove their creditworthiness. For those approved, credit limits start at $500 and run to as much as $10,000. The card not only provides access to credit for those with no score, but it offers up to 1.5% cash back on every purchase as well as 2% - 10% cash back from select merchants.
Beyond that, the Petal® 2 comes with these additional perks:
- No fees of any kind, including no annual fee, no late payment fee and no foreign transaction fee
- Reporting to all three major credit bureaus to help build a credit score
- Easy money management through the Petal app
- Receive one year of Amazon Prime Student on Deserve after spending $500 in the first three billing cycles with your EDU card (Lifetime Value of $59).
- Earn 1% Cash Back on all purchases with your Deserve EDU Mastercard. Once approved, you'll automatically start earning cash back on all purchases.
- Feel secure with cell phone protection up to $600.
- No deposit required. No annual fees.
- No international transaction fees on purchases abroad so you can travel with confidence.
- No Social Security Number required for international students to apply.
- Refer A Friend Program: Refer anyone to Deserve using your personal referral code. Upon approval, card activation and use, you'll receive $30 and so will your referral. Referral bonuses are unlimited!
- Manage and track your spending, set automatic payments and securely freeze your card all through one easy to use app.
- See if you prequalify with no impact to your credit score in minutes.
- Deserve Mastercards are issued by Celtic Bank, Member FDIC.
- Enjoy Mastercard Platinum Benefits intended to make your life easier like Mastercard ID Theft Prevention™ and Master Rental®.
What our editors like most about the Petal® 2
We love that the Petal® 2 is not only willing to approve applicants with no credit history, but it provides them rewards to boot. Its cash back percentage is competitive with other cards, and it's designed in a way to encourage responsible money habits. All cardholders start with 1% cash back on all purchases. That amount increases to 1.25% after six on-time payments and then 1.5% after 12 on-time payments. Additionally, cardholders can earn 2% - 10% cash back from select merchants (the list is available via the Petal mobile app) thanks to the card's Offers program. Just use your card with any of those merchants and the extra cash back is automatic – there's no need to sign up, keep up with rotating categories or worry about a cap. Merchants included vary, but could include Gap, Casper, Lowe's Home Improvement and more.
The Petal® 2 also gets kudos for being fee-free and extending credit limits of up to $10,000 to new cardholders, something you won't get with a secured credit card. Petal reports to all three major credit reporting bureaus - Experian, Equifax and TransUnion - to help users build their credit score.
Another reason to like Petal® 2 is its security features. Cardholders can temporarily freeze their accounts at any time. Customer service is available 24/7, and Petal's user-friendly app makes it easy to track spending for both your credit card and bank account in one place.
Potential downsides of the Petal® 2
While 1.5% cash back is similar to the standard rates offered by other cash-back cards like Chase Freedom Unlimited® and HSBC Cash Rewards Credit Card®, the initial 1% cash back rate is lower than what you could get elsewhere. What's more, unlike many other rewards credit cards, there is no welcome cash back bonus available for the Petal® 2.
Although the Petal® 2 is a great starter card for those with no credit, don't confuse it as a card for those with poor credit. If you have significant delinquencies or a bankruptcy on your record, you may not be approved.
Another potential downside of the Petal® 2 is that you can't use it for cash advances. Also, be aware that if you carry a balance, you'll pay an APR that currently ranges from 12.99 - 26.99% variable. That can easily wipe out any cash back rewards you earn with the card if you don't pay your balance in full each month.
How the Petal® 2 compares to other cash-back credit cards
Petal® 2 vs. Citi Simplicity® Card - No Late Fees Ever
Neither the Petal® 2 nor the Citi Simplicity® Card - No Late Fees Ever charge an annual fee or late fees. Citi Simplicity® Card - No Late Fees Ever takes that one step further by promising to never assess a penalty interest rate either. However, unlike Petal, the Citi card isn't truly fee-free. It charges foreign transactions fees, cash advance fees and balance transfer fees.
What's more, Citi Simplicity® Card - No Late Fees Ever doesn't offer any rewards. It does give cardholders free access to their FICO credit score as well as the ability to choose their own payment date, but that doesn't really compete with the 1%-1.5% cash back offered by Petal® 2.
Where the Citi Simplicity® Card - No Late Fees Ever does have a significant advantage over the Petal® 2 is in its 0% introductory APR for both purchases and balance transfers offer. The zero percent rate is good on purchases for the first 12 months after opening an account, and it extends to 21 months for balance transfers completed within the first four months. After that, the rates jump to 14.74% - 24.74% which are slightly higher than those on the Petal® 2.
Petal® 2 vs. Capital One Quicksilver Cash Rewards Credit Card
You won't pay an annual fee or foreign transaction fees with either the Petal® 2 or the Capital One Quicksilver Cash Rewards Credit Card. Both cards also offer unlimited 1.5% cash back although Petal requires 12 on-time payments to earn that rate while Capital One offers it immediately.
Capital One Quicksilver Cash Rewards Credit Card also has an advantage over the Petal® 2 in that it offers a welcome bonus opportunity: Spend $500 within the first three months of opening an account and you'll get a one-time cash back bonus of $200. Capital One also extends intro 0% APR on purchases for the first 15 months of opening an account. The card's standard APRs are 15.49% - 25.49% (variable).
Another advantage of the Capital One Quicksilver Cash Rewards Credit Card is its extensive perks. In addition to allowing cardholders to redeem cash back for gift cards, statement credits or cash, the card offers extended warranty protection, 24-hour travel assistance, travel accident insurance and a host of other benefits. However, you'll need very good or excellent credit to qualify for this card.
Petal® 2 vs. Capital One Platinum Credit Card
Both the Petal® 2 and the Capital One Platinum Credit Card are designed for those who don't have the excellent credit needed for other cards. While the Petal® 2 is designed for those with no credit, the Capital One Platinum Credit Card requires average, fair, limited credit.
You won't get any rewards with the Capital One Platinum Credit Card which puts it at a significant disadvantage to the Petal® 2. However, it provides perks such as free credit scores and credit monitoring tools through CreditWise from Capital One. Meanwhile, the Petal® 2 could give you up to a $10,000 credit line right off the bat.
Another advantage of the Petal® 2 over the Capital One Platinum Credit Card is its APR. While the Petal Card's APR ranges from 12.99 - 26.99% variable, Capital One Platinum Credit Card cardholders will pay 26.99% (variable) on their balances.
Is Petal® 2 a good card?
The Petal® 2 is a good card for anyone with a limited credit history. While it doesn't come with some of the bells and whistles offered by other rewards cards, it has a solid cash back offer. Plus, it's hard to argue with any card that isn't going to charge you fees.