This is my kind of thread! I am fascinated by the business models used in the financial industry.
During the past year I opened and closed a business card that was very similar to this Tomo. It was called Hatch. They called it a line of credit and it is marketed to small business owners who have difficulty getting a business credit card. I had a lot of credit issues at the time, so this was perfect for me. They used Plaid to check my business bank account history and qualify me for the card without a personal guarantee. The actual card was branded as a Visa commercial debit card. It did not earn rewards, and you could carry a balance on it. I liked the idea of this card, but the execution was not good.
Problems I experienced:
They held payment for up to 2 weeks, which is not conveninent if you have a smaller credit limit. Their online system was very laggy in terms of generating statements and other stuff. I frequently had my statement generate a week after the date it was supposed to, and they kept getting my interest charges mixed up. I paid in full most of the time, but they would charge me interest and then randomly refund it. IT WAS A HOT MESS. They similarly used a different company to handle the actual card services, but I can't remember the name.
I think the goal of these fintech firms is laudible, but I think their two biggest weaknesses are privacy issues and customer service. Coming from a tech background, they expect you to do everything on their website. When you have a catastrophic or strange issue that needs the human touch, they are very difficult to contact. I think I would trust a company like Petal long before a company like Tomo, because of their more experienced connections at WebBank.
@notmyrealname23 wrote:I think WebBank has a relation to Petal similar to that of Elan to the banks and financial firms they do credit card service for. They are a separate company.
https://www.petalcard.com/the-company
https://techcrunch.com/2019/01/29/petal-series-b/
Yes, I noted that those were all "partners" and separate companies. I did find the whole arrangement and connections to a much larger multi-national corporation quite intriguing. I was just pointing out that Petal gets money from interest charges, not only interchange fees. And that with the backing of $940 Million in assets from a large bank like WebBank, it gives them an additional financial options that many startups like Tomo may not have available. Who knows what sort of arrangement from WebBank helps to fund the Petal card? Plus, Petal's initial funding from investors as mentioned in the article was over $46 Million by January 2019. Maybe that funding money is invested with WebBank as part of their $940 Million in holdings as part of a deal. Perhaps Tomo hopes to do something like that as well. But I agree that at its' heart, it looks like Petal may also make profits from the data mining that I discussed earlier and that is where Tomo and Petal are similar.
The link you provided on the funding initiative was interesting. I also found an article from Forbes magazine (10/02/2018: Petal Set to Flourish with $34 Million Funding as US FinTech Finally Blossoms by Monty Munford.) The article touches on the very privacy concerns about data sharing but also highlights how EU legistation about consumer privacy rights has helped the FinTech business to grow there better than in the US where privacy protections lag.
I, for one, hope that the industry doesn't move so far in this direction that the momentum will make it almost mandatory for the average consumer to allow privacy intrusions before they can be granted credit. 
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(Forbes Magazine):
" ... (Petal) also said that 100,000 people who had already joined a waiting list in 2018, who will (obviously) be the first holders of the card. This sounds like a big deal for US FinTech startups, currently struggling to keep up with those in Europe.
There are a number of reasons why. US tech behemoths such as Amazon, Facebook, Apple and Google tend to discourage new opposition. Their ongoing forays into real-time payment apps and mobile banking services are frightening in their possible scope.
It’s not only that. Europe has especially benefited from legislation for the customer.
When authorized by the customer, the Payment Services Directive 2 (PSD2) enables the sharing of user (banking) data with other parties and here’s also the controversial General Data Protection Regulation (GDPR) that allows EU citizens to control their personal data; both initiatives mean a more transparent environment for consumers, banks and FinTech startups alike.
No surprise then that European FinTechs such as Monzo, Revolut, Transferwise, iZettle, Curve and many others have soared ahead in customer acquisition."
Link to complete article:
https://www.forbes.com/sites/montymunford/2018/10/02/petal-set-to-flourish-with-34-million-funding-a.../#7ef163d34850
