At a glance
Most credit-builder cards have lackluster benefits or require a security deposit or other fee — but the Petal® 2 “Cash Back, No Fees” Visa® Credit Card is a notable exception to the rule. It offers cash-back opportunities, no annual fee and no security deposit. These features, combined with a unique “Cash Score” application supplement that could help you qualify for the card without a credit history, make the Petal 2 Visa one of the best well-rounded cards for credit newcomers.
At a glance
Most credit-builder cards have lackluster benefits or require a security deposit or other fee — but the Petal® 2 “Cash Back, No Fees” Visa® Credit Card is a notable exception to the rule. It offers cash-back opportunities, no annual fee and no security deposit. These features, combined with a unique “Cash Score” application supplement that could help you qualify for the card without a credit history, make the Petal 2 Visa one of the best well-rounded cards for credit newcomers.
Our take
The Petal® 2 “Cash Back, No Fees” Visa® Credit Card, issued by WebBank, is the rare card that offers a rewards program to people with a limited or nonexistent credit history, providing an opportunity to earn cash back while you build your credit.
Also unusual: It requires no security deposit, charges no annual fees, foreign transaction fees or even late fees. Instead, it incentivizes cardholders to make payments on time by offering extra cash back opportunities. As long as you make your payments in full and on time, it won’t cost you to use this card -- even for purchases made while traveling abroad. As such, it’s a solid option for a first credit card, a credit card for students or a card for people with a thin credit profile.
Petal 2 Visa pros and cons
Pros
- Flexible credit approval process: Approval can be based on other financial factors, like your income and expenses, rather than just your credit score.
- Cash-back potential: Offers up to 1.5% cash back on everyday purchases.
- No fees: There are no annual fees, foreign transaction fees, returned payment fees or late fees.
- Credit line increase potential: With the Leap program, you could earn a credit line boost after six months of qualifying on-time payments (terms apply).
- Potential for a high credit limit: Your credit limit will range from $300 to $10,000, according to Petal. That’s higher than what many other fair-credit credit cards offer.
Cons
- No room for growth: The Petal 2 is this issuer's top-tier credit option, so when you’re ready to upgrade to a better rewards card, you’ll likely have to switch issuers.
- No in-branch support: This card is issued by WebBank, an online bank. This means you can’t get in-person customer support like you would get from an issuer like Bank of America or Capital One.
- Cash-back rate is lower for the first year: The 1.5% cash-back rate kicks in after 12 on-time monthly payments. But you'll still earn 1% cash back on eligible purchases right away.
Who this card is best for
- Credit newbies or those with limited credit history: The Petal 2 Visa is great if you're just starting on your credit journey or if you don’t have a credit history. When you link your bank account, Petal will take into account your “Cash Score” -- calculated using information like your income and bill payment history -- when considering your application.
- Those who want to earn rewards with a credit-builder card: While earning rewards isn’t the main point of a credit-builder card, it’s always a nice perk. Petal 2 is one of the few credit cards geared toward those with limited or fair credit that also offer cash-back rewards.
Who this card isn’t best for
- Those with good credit who can qualify for better cards: While the Petal 2 Visa offers competitive rewards for its category, it’s far from the best rewards card. If you already have good credit -- above 670 on the FICO scoring system -- you can likely qualify for other cash-back or travel cards with better rewards or more perks.
- Those with existing but damaged credit: While the Petal 2 Visa can help you build credit, it’s designed to help you build credit when you have a limited or no credit history. If your credit score is especially low, you may have better luck with cards specifically meant for rebuilding credit -- like the Petal® 1 “No Annual Fee” Visa® Credit Card* -- or cards that don’t require a credit check at all, like the OpenSky® Secured Visa® Credit Card.
A closer look at the Petal 2 Visa
Rewards
The Petal 2 Visa is a flat-rate rewards card that gives you the opportunity to earn the same rewards amount on all of your eligible purchases, regardless of the spending category (for context, some credit cards specialize in certain types of purchases, like gas credit cards or grocery credit cards). But there’s a twist built in to incentivize good credit-building behavior.
You’ll earn 1% on all of your eligible purchases up front. When you make 12 on-time monthly payments, you’ll earn an extra 0.5% cash back for a total of 1.5% -- in lieu of penalizing late fees. And some local small businesses and select merchants offer an additional 2% to 10% back on purchases, which you can find through Petal’s app.
Welcome bonus
The Petal 2 Visa offers no welcome bonus -- a common practice among cards designed for people with lower credit scores. Check out CNET’s list of the best credit card welcome bonuses to see the options for applicants with stronger credit.
Petal 2’s credit limit
The Petal 2’s credit limit -- that is, the limit you can spend on the card -- ranges from $300 to $10,000, based on creditworthiness. Your credit score, income, housing payment and other factors may help determine your initial credit limit, but you may qualify for a credit limit increase after six months of qualifying on-time payments.
Most credit cards designed for people with fair or average credit are secured credit cards; you must deposit money into your account before you spend it. Even among these types of cards, it’s tough to find one with a $10,000 credit limit. Though a larger credit line comes with the risk of overspending, it can help you build your credit score by minimizing your credit utilization ratio.
Cash Score -- a unique application feature
One of Petal’s unique features is its “Cash Score” system. You might be asked to link your bank account during the application, which will allow Petal to look at your income and bill payments to calculate a Cash Score that might factor into your application decision. Though Petal will look at both your Cash Score and your credit score, supplying Petal with your income details might increase your chances of approval, especially if you have no credit score or limited credit history.
Alternative cards
While the Petal 2 Visa stands out among the crowd, there are some alternatives that may better suit students or applicants with particularly poor credit.
Discover it® Student Cash Back
Enrolled students are eligible for student credit cards, which typically offer more modest rewards. The Discover it® Student Cash Back* is CNET’s pick for the best student credit card on the strength of its rewards-earning potential, which is even better than the Petal 2 Visa.
You’ll earn 5% cash back on a rotating quarterly category when you activate (on up to $1,500 in spending per quarter, then 1%) and 1% on all other purchases. And with Discover’s Unlimited Cashback Match™ welcome bonus, you can essentially double your annual cash back earned at the end of your first year.
For more information about the rotating quarterly category and other perks, see our full review of the Discover it Student Cash Back card.
Credit One Bank® Platinum Visa® for Rebuilding Credit
The Credit One Bank® Platinum Visa® for Rebuilding Credit* has a less compelling rewards structure than the Petal 2 Visa -- but this unsecured credit card has less stringent eligibility requirements, as applicants with a credit score of less than 580 may be approved.
There’s a $75 annual fee for the first year, which increases to $99 thereafter. You’ll earn 1% cash back on eligible gas and grocery purchases, and on monthly bills for your mobile phone, internet, cable and satellite TV services. That’s not as good as the Petal 2’s rewards, but it’s better than most other cards for bad credit. However, the annual fee makes it costly to keep in the long run, so you might want to consider no-annual-fee secured cards before turning to this one.
Bottom line
If you’re just starting on your credit-building journey, the Petal 2 Visa is likely to check most of your boxes for a first credit card, offering rewards, no annual fees and the potential to earn a credit limit increase in six months. Even though the card doesn’t charge any late fees or returned payment fees, you should still strive to pay your bills on time and in full every month to avoid interest charges and boost your credit score. And while the card’s cash-back rewards can provide a nice return on your spending, be sure not to charge more than you can afford just to maximize rewards — otherwise the interest you accrue will quickly overshadow your earnings.
FAQs
If your credit score is lower than 580 — the bottom limit of what’s considered to be a “fair” credit score on the FICO scoring system — your chances of approval are significantly lower. There are credit cards designed for people with bad credit, however, including secured credit cards that require you to put down a security deposit.
Using the Petal 2 Visa, or any other credit card, responsibly will help build your credit. For the most part, this means making payments on time and in full, while keeping your balance at or below 30% of your total credit limit (your credit utilization ratio). Credit card issuers will report your spending and payment activity to the major credit bureaus automatically.
The Petal 2 has a standard variable APR of 18.24% to 32.24%, though your particular APR depends on your creditworthiness. Typically, the lower your credit score, the higher you can expect your APR to be within that range.
*All information about the Discover it Student Cash Back, the Credit One Bank Platinum Visa for Rebuilding Credit, the Petal® 1 “No Annual Fee” Visa® Credit Card has been collected independently by CNET and has not been reviewed by the issuer.
