Varo Bank Review – Online Checking and Savings Accounts

Varo is a mobile-friendly online bank that can help you automate your savings, earn more interest^ on your balances, and build your credit****. And you can do it all while avoiding monthly maintenance fees and other hidden charges.

Varo is a great choice whether you’re just starting out on your financial journey or already well on your way to a brighter future. Without an investment account or unsecured credit products, it’s not quite as comprehensive as some financial institutions. But it’s definitely worth exploring if your current bank isn’t cutting it.

Key Features of Varo Bank

Varo offers four distinct products: 

• A bank account for day-to-day spending
• A high-yield savings account for emergencies and longer-term reserves
• A low-fee cash advance product to help you stretch to payday
• A secured credit card for building credit

Varo Bank Account

The Varo Bank Account is Varo’s everyday spending account. It’s an FDIC-insured online checking account with no minimum deposit requirement or minimum balance requirement and no monthly maintenance fees.

The Varo Bank Account comes with a Visa® debit card with contactless payment capabilities and an in-app locking feature. Select purchases and services earn up to 6%* cash back (check the Varo Perks tab in your account for up-to-date offers). Once you reach $5 cash back, Varo deposits real money into your Varo Bank Account.

The Varo Bank Account also offers early direct deposit for select customers. If your employer or government benefits provider files to the Federal Reserve to start the direct deposit process, you could receive your funds up to two days early.^^

The Varo Bank Account has some other notable features, including:

• No foreign transaction fees or overdraft fees
• Instant person-to-person (P2P) transfers with no transfer fees
• Transfer money using Zelle®
• More than 55,000 in-network Allpoint ATMs 
• Deposit cash at more than 90,000 retail locations using Green Dot Reload @ the Register (retail service fee applies).***

Varo Savings Account

The Varo Savings Account is a high-yield online savings account. It makes saving easier thanks to two automated savings tools that effortlessly send money from your Varo checking account to your Varo Savings Account:

• Save Your Pay: Choose a percentage of each direct deposit for Save Your Pay to transfer to your Savings Account.
• Save Your Change: Save Your Change automatically rounds up every transaction to the nearest dollar and transfers the round-up amount to your Savings Account.

The Varo Savings Account starts by earning 3.00% APY, and you can qualify to earn 5.00% APY on your balance of up to $5,000 if you meet these requirements:

• Receive total direct deposits of $1,000 or more in each qualifying period.**
• Make sure your Bank Account and Savings Account balances are above or equal to $0.00 at the end of the qualifying period.

Additional balances above $5,000 will earn 3.00% APY.

Varo Advance

Varo Advance is Varo’s cash advance product. Use it to get a cash advance between $20 and $100 with just one simple fee.

Varo Advance’s fees depend on the amount of the advance:

• $20 advance: Free
• $50 advance: $3
• $75 advance: $4
• $100 advance: $5

To qualify, your Varo Bank Account must be at least 30 days old and in good standing (no negative balances). You must receive at least $1,000 in combined direct deposits to your Bank Account and Savings Account within the 31 days prior to your advance. 

You must repay your advance within 30 days. Varo makes this easy — when you schedule your advance, choose to auto-repay it 15 or 30 days in the future. Once you repay your advance in full, you can take another one. 

Varo Believe

Varo Believe is a secured credit card that may help you build your credit over time.**** It has some nontraditional features that make it more flexible and user-friendly than the typical secured card:

• No minimum security deposit to get started
• No annual fee or interest rate (APR)
• The option to pay your credit card balance with your security deposit
• No hard credit check to apply

Varo Believe doesn’t allow you to spend beyond your security deposit. If you deposit $100 to start, your credit limit will be $100. And if you choose to pay your card balance with your security deposit, your credit limit will fall by a corresponding amount unless you make another deposit.

To qualify for Varo Believe, you must receive direct deposits totaling $500 or more in the most recent 90-day period. Your Varo Bank Account must not have a negative balance during that time. Additional qualifications apply.

Advantages of Varo Bank

Varo gives you a lot to like. Its highlights include excellent savings account yields^, great cash-back rates on select purchases*, automated savings features, and an innovative secured credit card.

• Excellent Savings Account Yields^. The Varo Savings Account has one of the better base yields around. When you meet two requirements in any given qualifying period, you can earn much more: Earn 3.00% APY, then qualify to earn 5.00% APY^ on balances up to $5,000. That’s a fantastic rate of return in a low-interest-rate environment. 
• Great Cash-Back Rates on Select Purchases*. Select Varo debit card purchases earn cash back at impressive rates. And because you can use your debit card wherever Visa is accepted, you’ll have plenty of opportunities to earn. 
• Early Direct Deposit and Paycheck Cash Advance for Eligible Account Holders. If you have a Varo Bank Account, you may qualify for early direct deposit if your employer or government benefits provider files to the Federal Reserve to start the direct deposit process. Early direct deposit timing varies, but you could receive your funds up to two days early.^ 
• Two Options for Easy, Automatic Savings. Varo offers two easy ways to automate your savings: by rounding up the change on every purchase and by setting aside a custom portion of each paycheck. Choose both to save even faster.
• Great Secured Credit Card for Qualified Applicants. Varo Believe is an innovative secured credit card with no monthly or annual fee, no interest charges, no minimum security deposit, and no hard credit check with your application. Plus, you can pay your statement balance with your security deposit. 

Disadvantages of Varo Bank

Varo isn’t quite perfect. No bank is. Its downsides include no investment account for market-traded securities and no unsecured credit card option.

• No Investment Account. Varo is fantastic for managing your cash flow and saving for the future, but it’s not a comprehensive money management solution. Notably, it lacks an investment account option, meaning you can’t own stocks, exchange-traded funds (ETFs), or any other market-traded securities in a Varo-branded account.
• No Unsecured Credit Card Option. For now, Varo only offers one credit card: Varo Believe, a secured product. If Varo adds an unsecured credit card option in the future — or makes it possible to upgrade to an unsecured version of the Believe card — it could further appeal to users whose credit is on the upswing.

How Varo Stacks Up

There’s no doubt Varo packs a lot of value into its lean, mobile-friendly frame. But how does it stack up against the top mobile-first online banks around?

To find out, let’s compare Varo against Chime, one of its biggest rivals.

Final Word

Varo is one of the best online banks available right now. It offers four distinct products that help customers with their everyday banking needs without charging monthly maintenance fees.

Taken together, Varo’s product lineup is nearly best-in-class. If you’re in the market for a new online bank, you’ll want to learn more about its features and capabilities.

*Individual offers may vary. 6% cashback available on specific items or services purchased online. Check the Varo Perks tab for more info and current deals. 

^Annual Percentage Yields (APY) are accurate as of December 1st, 2022. Rates may change at any time without prior notice, before or after the account is opened.

**The requirements must be met within the Qualifying Period begins on the first calendar day of the month and ends at close of business (4:25 pm MST/ 3:25 pm MDT) on the last business day of the month. Meet the requirements in the current month to qualify to earn 5.00% APY for the following month.

The qualifying period begins the first calendar day of the month and ends at close of business on the last business day of the month.

^^Early access to direct deposit funds depends on the timing of the payer’s submission of deposits. Varo generally posts such deposits on the day they’re received, which may be up to two days earlier than the payer’s scheduled payment date.

Bank Account Services provided by Varo Bank, N.A. Member FDIC. Visa® Debit Card is issued by Varo Bank, N.A. pursuant to a license from Visa U.S.A. Inc and may be used everywhere Visa debit cards are accepted.

***There is no fee assessed by Varo Bank for cash deposits. However, a retail service fee of up to $5.95 applies.

****The Varo Believe Credit Card is a secured credit card designed to help you build your credit; however, a variety of factors impact your credit including payment history, utilization, derogatory marks, account age, total number of accounts, and inquiries–not all factors are equally weighted. Building your credit may take time and is a process, but the Varo Believe Program may be able to help.