US-based credit card fintech Petal has raised $35 million in new funding and has spun off its B2B-focused data infrastructure and analytics subsidiary.
Valar Ventures led the new investment in Petal, and was joined by Story Ventures, Core Innovation Capital, and RiverPark Ventures, among other new and existing investors.
The funding includes strategic investments from Synchrony and Samsung Next, which will be split between Petal and Prism Data, its data spinoff.
Founded in 2016, Petal uses Open Banking data to help individuals establish and build credit responsibly, by providing access to Visa credit cards issued by WebBank to Americans who have never used credit before or have little previous credit history.
While Petal serves consumers directly, Prism Data provides cash flow underwriting technology to financial institutions, fintechs, and other businesses, enabling them to use Open Banking to build products and inform their credit decisioning.
“Prism Data was founded on the belief that Open Banking, and access to consumer-permissioned bank account transactional data, will change the way consumer finance works—in credit, payments, banking, insurance, real estate, financial advising, and more,” said Erin Allard, Prism’s general manager.
“With Open Banking’s arrival in the US, that is becoming a reality. And as an independent company, Prism is well-positioned to partner with financial providers and give them the tools and infrastructure they need to create next-generation products and capabilities.”
Nearly 400,000 consumers have been approved for a Petal credit card, with more than 100,000 new cards approved in 2022.
Trish Mosconi, executive vice president and chief strategy corporate development officer at Synchrony, added: “The Prism Data platform is innovative in providing differentiated consumer insights, enabling financial institutions to make more data-driven decisions.
“We look forward to exploring partnerships with Petal and Prism Data to help improve access to credit.”
Arjan Schutte, founder and managing partner of Core Innovation Capital said that while Prism is a new company, the core technology and approach have been “honed in the market” by Petal.
“The potential for much-needed financial inclusion through a cash-flow-based score that is compliant with consumer regulation is massive,” Schutte added.