Petal , a US-based credit card and financial technology company, has announced closing a USD 200 million debt facility from Victory Park Capital as well as raising additional debt and equity funding. Petal announced extending its existing term loan facilities and closed a new term loan with Trinity Capital, a financial solutions provider, for up to USD 20 million of incremental commitments.

Petal has also raised more than USD 20 million in new equity financing from its existing investors to strengthen its financial position, building on the USD 35 million funding Petal announced earlier in May 2023. This recent influx of sources will provide the company with fuel to expand the Petal credit card program, which offers access to high-quality Visa credit cards issued by WebBank to consumers who are new to credit, without requiring established credit scores for qualification. Petal offers access to credit cards without a credit score, through an approach called cash flow underwriting.

Unlike traditional credit scoring methods, this method enables individuals to use their banking history to evaluate their creditworthiness and establish a credit history. The approach has also made credit more accessible to many US customers without credit histories, or whose traditional credit scores provide a limited view into their financial status and creditworthiness. Timely expansion and alignment with new regulations Cash flow underwriting is seemingly more relevant in the current economic climate, as Americans applying for credit cards are increasingly likely to be turned down by traditional bank lenders.

The Federal Reserve’s Center for Microeconomic Data released information in June 2023 showing that the overall rejection rate for credit applicants is at the highest level since 2018. The rejection rate is particularly prominent among those whose credit scores are below 680. The company’s expansion also aligns with the upcoming Consumer Financial Protection Bureau (CFPB) rulemaking on Dodd-Frank Section 1033.

This new rule is expected to help consumers access and share cash flow data for use in credit underwriting purposes. By leveraging this cash flow data, more consumers have a chance to qualify for credit, even if their credit scores may have otherwise prevented them from receiving credit. With this recent addition of funding, Petal has raised more than USD 300 million in equity capital and USD 680 million in debt financing.

More about Petal and Victory Park Capital Petal is a credit card company aimed at helping people financially succeed and to make credit more accessible. Founded in 2016, the company offers a simple, modern digital experience that encourages members to build credit, avoid debt, and spend responsibly. Victory Park Capital is a global alternative investment firm founded in 2007 and is headquartered in the US. VPC provides custom financing solutions across the private capital spectrum, focusing on companies with strong corporate governance and a compelling growth trajectory.

VPC invests in emerging as well as established businesses across various industries worldwide. .