FinTech News

Empower Financial to Acquire Petal

by Kyle BurbankApr 10, 2024

The popular credit-building card company Petal is being acquired.

About the deal:

Empower Financial (not to be confused with Empower, which acquired Personal Capital and rebranded it to Empower Personal Dashboard) has signed a definitive agreement to acquire Petal. Details of the deal were not disclosed. However, Empower anticipates the transition to close later this quarter.

News of this acquisition also comes as Empower has completed its purchase of Cashalo. According to Empower’sc co-founder and CEO Warren Hogarth, both platforms will be merged into the Empower platform.

About Petal and Empower:

Petal is a credit card company that offers multiple products aimed at helping consumers build credit. To do this, it qualifies users for its cards by using other factors outside of traditional credit scores. Additionally, select Petal cards offer cashback rewards and other perks. Since 2018, Petal has approved more than 400,000 consumers for cards (which are issued by WebBank).

Empower Financial is a FinTech that also looks to expand access to credit. This includes offering a cash advance feature as well as its Thrive line of credit.

What they’re saying:

Commenting on the acquisition, Petal co-founder Jason Rosen said, “Safe, affordable credit is unavailable to tens of millions of consumers in the U.S. and billions worldwide. We believe that modern product design and new technologies like cash flow underwriting can be used to radically improve credit access around the world. This merger brings together two of the leading innovators in this arena. Our combined product offerings, financial strength, technical capabilities, and global reach will allow us to move much faster to close the equity gap in credit.”

My thoughts:

Before I get to the matter at hand, I have to share how confused I was that this Empower was different from the other one. This was made even worse by the fact that the press release site seemingly treats them as though they (and yet another Empower!) are one entity.

Anyway, having been familiar with Petal for years, I’m a bit surprised to see that they’re the ones being acquired in this transaction since I’d never heard of (this) Empower. It’s also notable that, according to Crunchbase, Empower Financial has raised a total of $174.5 million to date whereas Petal has raised $992.6 million. Subtracting debt rounds from that total, it’s still more than double Empower’s tally.

Setting those dynamics aside, it does seem as though Empower and Petal have similar goals. Thus, together, they could well be a FinTech force for good.

Author

Kyle Burbank

Head Writer ~ Fioney

Kyle is the head writer for Fioney. He is a personal finance nerd, constantly looking for new apps and services to test and incorporate into his own financial game plan. In addition to his role at Fioney, he's written for other publications including Born2Invest, Lifehack, and Laughing Place, as well as his own site Money@30. He also creates personal finance and travel-related videos for Fioney's YouTube channel, which has garnered more than 2 million views. Currently, Kyle resides in Springfield, Missouri with his wife of 10 years. Together, they enjoy traveling (including visiting Disney Parks around the world), dining, and playing with their dog Rigby.

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