Petal® 1 “No Annual Fee” Visa® Credit Card review

Why you might want the Petal® 1 “No Annual Fee” Visa®

Though it lacks the robust cash back rewards program that comes with the Petal® 2 "Cash Back, No Fees" Visa® Credit Card, the Petal® 1 "No Annual Fee" Visa® Credit Card should help you keep costs low as you work to build a positive credit history.

The card charges no annual fee, does not require a deposit and gives you a chance at a much higher-than-average credit limit compared to other credit-building cards. You can also qualify with a limited credit history to fair credit score, and the card’s issuer may consider more than just your credit score when evaluating your application.

That said, some fees may still apply if you don’t keep up with your Petal 1 Card payments. The card’s APR is also on the high side, making it risky if you suspect you’ll need to carry a balance.

See related: How to build credit

No annual fee

As its name makes clear, one of the biggest draws of the Petal 1 “No Annual Fee” Visa card is that it charges no annual fee. While there are plenty of no-annual-fee cards to choose from, this feature is especially compelling, considering the Petal 1 Card is an unsecured credit card designed for credit-builders.

Unsecured credit-building cards are known for their high fees, with many charging annual fees of $70 or more. Some will even increase your annual fee or tack on new maintenance fees after the first year, making building credit an expensive prospect. Secured credit cards, meanwhile, tend to charge fewer fees but require a refundable deposit upfront, which can be a deal-breaker if you have little cash on hand.

Since the Petal 1 Card charges no annual fee and requires no deposit, it could be an excellent option for cardholders who want to keep costs low and avoid tying up money.

Different from the Petal 2 Card, however, the Petal 1 Card is not entirely fee-free. Late and returned payment fees may still apply with the Petal 1 Card. That said, as long as you pay on time and in full, it costs you nothing to be a Petal 1 Card member.

Chance at a high credit limit

The Petal 1 Card is also notable for its wide range starting credit limits. Depending on your credit history and financial standing, you can get a credit limit of anywhere from $300 to $5,000.

While there are several high-limit secured cards on the market, a $5,000 limit is almost unheard of among unsecured credit-building cards. Even the card’s minimum credit limit of $300 is one of the higher limits offered on such cards. This is a major plus, as a higher credit limit will make it much easier to keep your credit utilization ratio – the amount you’ve borrowed compared to your total available credit – in check. You can use tools like our credit utilization calculator to monitor your credit utilization ratio.

See related: What affects your credit score?

Robust mobile app

Though the Petal 1 Card leaves a bit to be desired on the rewards and perks front, it comes with many useful tools for credit-builders who want to keep an eye on their spending and score.

With the Petal app, you can set a monthly budget and track spending, find Petal Offers near you, sort through subscriptions being charged to your card and more. The app also gets you access to your VantageScore 3.0 credit score from Experian (updated monthly) and includes features like a payments calculator that shows you exactly how much you’ll pay in interest based on the amount of your payment.

Approval odds and Petal Cash Score

The Petal 1 Card is designed for users with no credit history or a non-prime credit score. As such, it should offer decent approval odds for people building their credit score with responsible use. However, the issuer does specify that applicants who’ve previously applied for a Petal card are not eligible.

In addition to your credit score, the card’s issuer may consider alternative financial data like your income and bill payment history to generate a unique Petal Cash Score used to evaluate your creditworthiness. This could be a big help if you have an unimpressive score but are otherwise on sound financial footing.

Luckily, you can check to see if you prequalify for the Petal 1 Card (and get suggestions as to which Petal card is right for you based on your financial profile) at Petal’s website. Checking for prequalified offers has no impact on your credit score and should give you a better sense of your approval odds before you apply.

Why you might want a different card

While the Petal 1 Card offers a variety of helpful credit-building features, it also has a few notable drawbacks that make it less-than-perfect for everyone. Here are a few reasons why.

Very high APR for some cardholders

One of the main downsides of the Petal 1 Card is its potentially high variable APR. The card carries an APR of 25.24% to 34.74% variable, which could come back to bite you if you need to be more diligent about paying off your balance in full each billing cycle.

While this rate is on par with many unsecured credit-building cards, it’s much higher than the rate offered by the Petal 2 Card (18.24% to 32.24% variable).

Limited rewards program and perks

Unlike the Petal 2 Card, the Petal 1 Card does not offer consistent cash back rewards.

However, through the Petal Perks program, you can earn 2% to 10% cash back when you use your card at select local merchants. These offers are automatically loaded to your account, and you can redeem the cash back you earn as a statement credit, check or ACH transfer to your bank account.

The Petal 1 Card comes with a few run-of-the-mill cardholder perks through its partnership with Visa, including Visa Local Offers (which earns you Uber credits for spending at featured local stores upon enrollment), auto rental collision insurance, theft coverage and a pay-per-use roadside dispatch program.

How does the Petal 1 Card compare to other credit-building cards?

While it carries minimal fees and offers a chance at a high credit limit, the Petal 1 Card doesn’t come with much in the way of perks. There’s also no clear path for switching from the Petal 1 Card to the more lucrative Petal 2 Card, limiting the card’s long-term value.

If you’re willing to pay a modest annual fee or put down a deposit, you can make up for it with rewards and other benefits. Here are a few of our favorite alternatives:

Capital One QuicksilverOne Cash Rewards Credit Card	Credit One Bank American Express® Card	Discover it® Secured Credit Card
Rewards rate Earn unlimited 5% cash back on hotels and rental cars booked through Capital One Travel, where you'll get Capital One's best prices on thousands of trip options. Terms apply Earn unlimited 1.5% cash back on every purchase, every day	Rewards rate 1% cash back on all purchases (terms apply)	Rewards rate Earn 2% cash back at Gas Stations and Restaurants on up to $1,000 in combined purchases each quarter, automatically. Earn unlimited 1% cash back on all other purchases.
Credit limit See terms	Credit limit Starting at $500	Credit limit $200-$2,500 (equal to your deposit)
Annual fee $39	Annual fee $39	Annual fee $0
Other things to know Account reviewed for possible credit limit increase after 6 months of on-time payments Automatic cash back redemption available No foreign transaction fees	Other things to know Check if you prequalify online Future credit line increases may be granted based on your credit performance Includes perks like purchase protection, extended warranty coverage, return protection and access to Amex® Offers	Other things to know Includes free FICO score No late fee the first time you pay late (after that, up to $41) No foreign transaction fee No penalty APR and guarantees not to raise your APR if you skip a payment

Capital One QuicksilverOne Cash Rewards Credit Card

Designed for cardholders looking to bolster their credit scores, the Capital One QuicksilverOne card offers unlimited 1.5% cash back on every purchase. While this is not the most impressive cash back rate, it should help to offset the card’s $39 annual fee. You’ll also have a chance at a credit limit increase if you make six consecutive on-time payments.

Credit One Bank American Express® Card

Most notable for its numerous cardholder perks, including purchase protection, extended warranty coverage, return protection and more, the Credit One Bank American Express card is a relatively low-cost option if you have fair credit or better and are looking for an unsecured starter card. Though the card charges a $39 annual fee, you should be able to offset this if you use it for most of your spending.

See related: Credit One vs. Capital One

Discover it® Secured Credit Card

Another card that combines credit-building with cash back rewards, the Discover it® Secured Credit Card offers 2% back at gas stations and restaurants (on up to $1,000 in purchases per quarter) and 1% back on all other purchases. Plus, Discover will match all the cash back you earn at the end of your first year. Though the card requires a deposit, you can enjoy more control over your credit limit, as you can put down $200 to $2,500 as a deposit and get a matching limit. You may also be able to graduate to an unsecured Discover card with responsible use.

Who should get the Petal 1 Card?

• Cardholders with a limited credit history or lackluster credit score looking to build credit.
• Cardholders looking to avoid an annual fee or security deposit.
• Cardholders who want a chance at a higher than average credit limit.
• Cardholders who are in good shape financially but have a limited credit history or middling credit score.

How to use the Petal 1 Card:

• Pay on time and keep your credit utilization low to give yourself the best chance of improving your credit score.
• Pay the card monthly in full to avoid the card’s potentially high APR.
• Use the Petal mobile app to track your credit score, spending and more to ensure you stay on the right track financially.
• Take advantage of Petal Offers at select local merchants to earn 2% to 10% cash back when you use your Petal 1 Card.

Is the Petal 1 Card worth it?

Yes – if you have a limited credit history or non-prime credit score and are hoping to build credit with responsible card use, the Petal 1 Card could be a solid option. While its APR is high and its rewards program leaves much to be desired, the card does not require a security deposit and charges minimal fees in stark contrast to many unsecured credit-building cards.

Plus, since it may factor in financial information like your income and bill payment history, the issuer’s “Cash Score” system could help you qualify for a higher limit or lower APR than you otherwise would have been assigned based solely on your credit score.

The Petal® 1 “No Annual Fee” Visa® Credit Card is issued by WebBank.