When it comes to credit-building tools, the Petal 2 Cash Back, No Fees” Visa® Credit Card from WebBank stands out as a top choice. With a zero annual fee and a competitive cash back rate, this credit card is a valuable asset for those looking to establish or improve their creditworthiness.
Key Features:
- Finance Devil Rating: 4.5 stars out of 5
- Rewards Rate: 1% – 1.5%
- Annual Fee: $0
- Intro Offer: N/A
- Regular APR: 18.24% – 32.24% (Variable)
Petal 2 Cash Back, No Fees” Visa® Credit Card Overview: Building Credit with Earning Potential
The Petal 2 Visa Credit Card is an exceptional option for individuals seeking a credit card without annual fees, particularly those on a journey to build or rebuild their credit profiles. While it may not offer an extensive range of perks, it distinguishes itself among cards tailored for individuals with limited or no credit history.
Rewards:
- Earn 1% cash back on eligible purchases, with the potential to increase to 1.5% after making 12 on-time payments.
- Unlock the opportunity to earn between 2% to 10% cash back at select merchants.
Rates and Fees:
- This card has a $0 annual fee, making it budget-friendly.
- The regular APR falls within the range of 18.24% – 32.24% (Variable), which is competitive for a credit-building card.
Credit-building Features:
- Your credit activity is reported to all three major credit bureaus, aiding in the establishment of a positive credit history.
- Manage your finances effortlessly with the mobile app and monitor your credit score.
- The card offers the potential for higher credit limits, and through the Leap program, you can increase your limit with consistent on-time payments.
Other Cardholder Perks
- Enjoy travel benefits such as auto rental collision insurance and roadside dispatch.
- No late fees, returned payment fees, or foreign transaction fees add to the card’s appeal.
Pros and Cons:
Pros:
- Accessibility for those building credit, as a credit score is not required for qualification.
- Freedom from annual fees, foreign transaction fees, late payment fees, or returned payment fees.
- The card sets itself apart by offering rewards, which is uncommon among credit-building cards.
Cons:
- Lack of balance transfer options, which may limit its usefulness for those looking to manage debt while building credit.
- The rewards structure, based on on-time monthly payments, might be somewhat intricate for individuals new to credit cards.
How the Petal 2 Card Works:
Upon acquiring the Petal 2 Visa® Credit Card, you immediately begin earning 1% cash back on eligible purchases. However, with consecutive on-time payments, your cash back rate can increase to 1.25% after six on-time payments and a noteworthy 1.5% after making 12 on-time monthly payments. Additionally, you may occasionally earn “Bonus Cash Back Points” on qualifying purchases, providing an undisclosed higher cash back rate or an alternative reward.
The Petal Offers program opens doors to earning between 2% to 10% cash back at select merchants. By sharing your location with the Petal card app, you can identify nearby local businesses offering enhanced cash back offers. These merchant offers are automatically loaded onto your Petal account, ensuring you’re eligible for higher cash back rewards when you make purchases at selected merchants.
For every Petal 2 credit card purchase, 1% of your expenditure is automatically deposited into your Cash Back Wallet during the following billing cycle. You can redeem the Cash Back Points stored in your Cash Back Wallet as a statement credit, covering the current balance amount. If your available balance exceeds $20, you have the option to request a transfer to a bank account or receive a check. There’s no limit to the amount of Cash Back Points you can accumulate.
Furthermore, the Leap program offers an opportunity to increase your credit line by making at least 15% of your monthly statement or minimum balance payment on time for six consecutive months. A higher credit line enables you to maintain a lower credit utilization rate, which can contribute to enhancing your credit score.
Why You Might Choose the Petal 2 Visa:
The Petal 2 card is an excellent alternative to traditional secured credit-building cards, especially if you aim to build credit without a credit history or prefer not to make a deposit. Unlike secured cards, the Petal 2 doesn’t require prior credit history for qualification.
Consider the following advantages as you determine the most suitable credit-building card for your needs:
Rewards Rate
Versatile Ways to Earn Cash Back The Petal 2 Visa® offers multiple avenues for earning rewards. While the cash back value may be slightly lower compared to other cash back cards, it isn’t confined to specific spending categories. This means you can earn cash back on various types of purchases, including gas, restaurants, groceries, local transit, and more. Additionally, the card incentivizes consistent and punctual payments through its cash back tiers. Even without these tiers, you have the potential to earn up to 10% cash back at select merchants via the Petal Offers program. With no limits on your earning potential, you can accumulate and redeem substantial rewards.
Rates and Fees
Low-end APR and Zero Annual Fee The Petal 2 credit card boasts a “no-fee” structure, featuring no annual fees, foreign transaction fees, late fees, or returned payment fees. Furthermore, the lower end of the card’s APR range, which falls between 18.24% and 32.24% (Variable), positions it favorably below the current average interest rate. The absence of fees and the potential for a low APR are significant advantages as you progress toward establishing a healthy credit score. However, it’s worth noting that balance transfers and cash advances are currently not supported, and the variable APR may result in interest rates higher than average, depending on your creditworthiness.
Credit-building Features
Monitoring Progress and Increasing Credit Limit The Petal 2 card reports your credit activity to all three major credit bureaus, facilitating the development of a positive credit history. As you consistently make on-time payments, you not only enhance your credit profile but also accumulate a stockpile of cash back rewards. The card offers a free credit score monitoring feature through Petal’s mobile app, allowing you to track your credit progress effortlessly.
Moreover, the Leap program provides an opportunity to raise your credit limit by maintaining timely payments for six consecutive months. This higher credit limit provides more flexibility to maintain a low credit utilization rate, which can contribute to gradual credit score improvement. However, please bear in mind that your potential credit limit with this card is contingent on your creditworthiness, and a high limit is not guaranteed.
Why You Might Consider Another Cash Back Card
While the Petal 2 card is an excellent choice for individuals with fair credit looking to boost their credit scores, it’s important to be aware of its limitations before applying.
Welcome Offer: Some alternative cards offer both rewards and a sign-up bonus. The Petal 2 card lacks a welcome bonus. If you’re seeking a card that provides both a flexible rewards structure and a sign-up bonus, consider exploring options like the Discover it® Secured Credit Card. This card not only offers cash back but also automatically matches your total cash back rewards earned at the end of your first year. A matching rewards program for the first year can alleviate financial burdens, especially for individuals who are just beginning their credit journey with limited or no credit history.
How the Petal 2 Card Compares to Other Cash Back Credit-Building Cards
Credit-building cards often come with limited perks and rewards and may require a deposit or annual fee. However, there are alternatives similar to the Petal 2 where cardholders can earn rewards while working on their credit profiles. Let’s compare the Petal 2 Visa Credit Card to other credit-building options:
Petal 2 Visa Credit Card vs. Discover it® Secured Credit Card
If you’re seeking a cash back credit card to build credit, the Discover it® Secured Credit Card is a noteworthy choice. It offers elevated cash back rates at restaurants and gas stations on a set amount of combined purchases each quarter, alongside unlimited 1 percent cash back on all other purchases. Similar to the Petal 2, the Discover it® Secured Credit Card does not have an annual fee or foreign transaction fees. Moreover, any cash back rewards you earn during the first year are automatically matched at the end of your first year.
However, it’s important to note that the Discover it® Secured Credit Card is a secured card, requiring a refundable security deposit that serves as your credit limit. This deposit can act as a barrier for some individuals.
Petal 2 Visa Credit Card vs. Capital One QuicksilverOne Cash Rewards Credit Card
Another option for those looking to improve their credit while earning cash back is the Capital One QuicksilverOne Cash Rewards Credit Card. Like the Petal 2 Visa Credit Card, QuicksilverOne cardholders earn a respectable rewards rate of 1.5 percent cash back.
However, there is a notable difference—cardholders must pay a $39 annual fee with the QuicksilverOne card. Additionally, this card imposes stricter credit requirements, with Capital One recommending a 580 to 740 FICO credit score for eligibility. On the positive side, the QuicksilverOne card does not require a security deposit, making it more accessible than many secured credit cards.
Both the Petal 2 and QuicksilverOne cards offer automatic consideration for a credit line increase after as few as six months of on-time payments, potentially simplifying the process of maintaining a low credit utilization rate.
Best Cards to Pair with the Petal 2 Visa
It’s essential to exercise caution when applying for multiple cards simultaneously while working on your credit. Applying for too many cards at once can temporarily impact your credit score negatively. It may be more prudent to focus on using the Petal 2 card to build your credit initially and then explore additional options down the road.
As your credit improves over time, you can consider cards designed for individuals with good credit, including travel rewards cards and cash back cards with more competitive cash back rates.
Who Is the Petal 2 Card Right For
Individuals with Limited or No Credit History: The Petal 2 Visa Card is an excellent choice for those who possess limited or no credit history. It provides a straightforward path to establish a strong credit score. Since it doesn’t require a credit score or a security deposit for eligibility, it is easily accessible. The card’s credit-building features and mobile app make it convenient for tracking and improving your credit score.
Students: This card is particularly appealing to students who are just embarking on their financial journeys and have no credit history. Students can earn cash back on purchases while laying a solid foundation for their credit, provided they make timely payments. Students studying abroad can also benefit from the card’s lack of foreign transaction fees. While other student credit cards may offer better rewards and welcome offers, the Petal 2 Visa is still a worthy consideration due to its absence of fees and potential for a high credit limit.
Is the Petal 2 Card Worth It?
Many credit-building cards do not offer rewards, making the Petal 2 Visa Card unique in this regard. It enables cardholders to earn cash back, and its rewards structure incentivizes on-time payments, serving as a positive incentive for building credit.
Students may find better options with dedicated student credit-building cards, while individuals with poor credit may discover secured credit cards more effective. Depending on your preferences for cash back rewards, you should explore other cash back rewards cards.
However, please note that cards with superior cash back rewards typically come with more fees and require a good to excellent FICO score.
FAQs
Is the Petal 2 good for people with bad credit?
The Petal 2 is not ideal for individuals with damaged credit. It is best suited for those with limited or no credit history. If your credit has been negatively impacted, consider other cards specifically designed for bad credit, such as secured credit cards.
What’s the difference between the Petal 1 and the Petal 2?
The Petal 1 “No Annual Fee” Visa Credit Card imposes late payment and returned payment fees, while the Petal 2 card does not. Additionally, Petal 2 cardholders enjoy more significant rewards.
What’s the credit limit for the Petal 2?
Your Petal 2 credit limit will vary based on your credit score. It can range from $300 to $10,000, offering a broader range of potential credit limits than you typically find on unsecured cards designed for individuals with limited credit histories.
Can you increase your Petal 2 card’s credit limit?
While you may be offered a credit limit increase if you qualify, you cannot request a credit limit increase on your own. To increase your credit limit, manage your card responsibly and make on-time payments over time.
Do you need to complete a credit check for a Petal 2 credit card application?
As with most credit cards, a hard credit check is necessary when applying for the Petal 2 credit card. A hard credit check may temporarily lower your credit score and remain on your credit report for up to two years. To get an idea of your approval odds for various cards before undergoing a hard credit check, consider using Finance Devil’s CardMatch™ tool, which does not impact your credit. Additionally, you can check for preapproval for a Petal card without a credit check on Petal’s website. However, preapproval does not guarantee account approval, as a completed application with a hard credit pull is still required.
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