Varo

Varo provides digital banking services via a web portal and mobile app. The company enables customers to sign up and create accounts directly via its platform, claiming that accounts can be created within five minutes. In August 2020, the company received its banking license, becoming the first neobank in the US to obtain its own license.

The company provides checking accounts with a debit card, and charges no monthly/transfer/foreign exchange/ATM fees, and also does not impose minimum balance requirements. The account also enables customers to make instant money transfers as well as make free instant payments to anyone with a debit card through ‘Varo for Anyone.’ In addition, account holders can connect their accounts with payment services such as Apple Pay, Google Pay, and PayPal. Moreover, Varo also provides savings accounts, which offer annual percentage yields (APY) of up to 5%, claiming to be higher than the industry average.

In October 2020, the company entered the credit space, by launching ‘Varo Advance’, which provides instant cash advances of up to USD 500 to eligible customers. Advances of up to USD 20 are offered with no extra fees, while the maximum charge for a USD 500 advance stands at USD 40. Customers are required to make repayments within a 30-day period. Furthermore, In February 2021, the company introduced another credit product; ‘Varo Believe’, which provides a credit card, and credit monitoring facilities and aims to help individuals develop and improve their credit scores. Under this package, credit cards are linked to a Varo bank account, and money spent via credit card is reserved into a vault from the linked bank account in real-time, to ensure that payments are made in full, and on time. Varo directly sends payment history to credit bureaus and customers are able to monitor their credit scores via the Varo app. The neobank also offers "Varo Line of Credit," which allows customers to borrow against their credit history and access credit of up to USD 2,000. 

In 2022, Varo generated total interest income of USD 7.9 million, and generated a net loss of USD 236.5 million. 

Key customers and partnerships

As of March 2023, Varo Bank served over 7 million customers.

The company partnered with Zelle, a peer-to-peer payment platform in November 2022, to make the latter’s services available through its mobile banking app. Customers can use this service to send and receive money among friends, family, and small businesses. It also partnered with Column Tax in January 2024, to offer free in-app tax services. In August 2024, Varo signed a five-year deal with Marqeta to use its card-issuing technology, as well as benefit from enhanced transaction management, and digital wallet tokenization with Apple and Google Wallets.