The Petal 2 card can be an excellent alternative to traditional secured credit-building cards if you want to build credit without any credit (or if you aren’t eligible) and prefer not to put down a deposit. Like most secured cards, you don’t need previous credit history to qualify for the Petal 2.
Consider these benefits as you select the right credit-building card for you.
Rewards rate: Versatile ways to earn cash back
If you want a card that offers many ways to earn rewards, then the Petal 2 Visa delivers. While the value rate might be on the lower end compared to other cash back cards, your cash back is not limited to specific rewards categories. So you can earn immediately on all eligible purchases bought with this card. That includes spending on gas, restaurants, groceries, local transit, among other items.
Additionally, the card rewards steady and consistent payment with its cash back tiers, but even without the tiers, you could earn up to 10 percent back with select merchants through their Petal Offers program. With no limit to how much you can earn, you could easily collect and redeem a significant amount of rewards.
Rates and fees: Low-end APR and $0 annual fee can help with payments
The “no-fee” Petal 2 credit card has no annual fees, foreign transaction fees, late fees or returned payment fees, and the low end of the card's APR of 18.24% - 32.24% (Variable) is below the current average interest rate. No fees and a potentially low APR can be crucial factors as you work toward building a healthy credit score.
However, you can’t make balance transfers or cash advances at the moment, and its broad APR range, determined by your creditworthiness, means you may see interest rates well above average.
Credit-building features: Track progress and potential to increase credit line
The Petal 2 card reports activity to all three major credit bureaus. As you pay back what you owe on time, you can build up your credit and increase your cash back rewards stockpile. You can also use Petal’s mobile app to manage your money and receive a free credit score to track your progress. Also, with the Leap program, you have the chance to improve your credit limit with consecutive on-time payments.
Credit limits range from $300 to $10,000, which is good news for credit builders. The higher your credit limit, the more room you’ll have to keep your credit utilization low when you make purchases and carry balances on the card. Keeping your credit utilization low may boost your credit score over time. Just keep in mind that your potential credit limit with this card is based on your creditworthiness, and a high limit is not guaranteed.