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Petal is a U.S.-based financial technology company headquartered in New York. Petal offers a pair of no-annual-fee Visa credit cards, in partnership with WebBank, along with a mobile app that enables consumers to manage their financial lives. Petal has said its products are designed to help people financially succeed, in particular people who are new to credit or who have little credit history.

History
Petal was founded in 2016 by entrepreneurs Jason Gross, Andrew Endicott, Jack Arenas and David Ehrich. Petal announced its first product, the Petal Visa card, in September 2017 and launched the card in October 2018. In October 2020, Petal renamed its existing card “Petal 2” and introduced a second credit card, Petal 1.

In May 2019, Petal introduced a rewards program that gives consumers higher cash-back percentages when they establish a track record for paying their bills on time. In September 2019, Petal announced that it had more than 50,000 cardholders, two-thirds of which are millennial and Gen Z consumers. Petal has raised more than $100 million in venture capital funding. In January 2018, Petal announced it had secured $13 million in Series A funding, an investment led by Valar Ventures. In January 2019, Petal announced it had secured $30 million in Series B funding, and in September 2020, announced a $55 million Series C round of financing. In September 2019, Petal announced it had closed a $300 million debt facility from global investment bank Jefferies.

Technology
Petal's platform uses machine learning to assess applicants’ creditworthiness, analyzing their full digital financial record (how much an individual makes, spends and saves, and the bills they pay) to determine how much credit each person can responsibly manage.

This “cash flow” model leverages banking history to determine an applicant's creditworthiness. Where possible, Petal’s algorithms complement this cash flow data with credit bureau data on an applicant’s credit history. Utilizing alternative data in this manner enables Petal to make credit accessible to consumers even if they have a limited credit history.

According to research released in July 2019 by the nonprofit FinRegLab, cash-flow data — the money flowing in and out of customer accounts every month — may be useful in predicting creditworthiness. This study analyzed data from six nonbank lenders that use cash-flow data in their underwriting: Accion, Brigit, Kabbage, LendUp, Oportun and Petal. Several other financial technology and payments companies, including Square Inc., Stripe and Brex, use cash-flow data to inform underwriting decisions for small businesses. The Wall Street Journal has reported that JPMorgan Chase & Co., Bank America Corp., Wells Fargo & Co. and Citigroup Inc. "are seeking to augment credit reports and scores with real-time income or cash-flow data....to evaluate new loan applicants, specifically, those seeking credit cards and other loans that don’t typically require income documentation."