Varo Money Review

Mobile-only banking with no fees and competitive savings rates

 FACEBOOK
 TWITTER
 LINKEDIN

By EMILY GUY BIRKEN

Updated Jul 7, 2020
TABLE OF CONTENTS

 Pros Explained
 Cons Explained
 Who is Varo Best For?
 What Does Varo Offer?
 Varo Customer Service
 How to Bank With Varo
 Verdict
 Methodology

Founded in 2015, Varo is an all-mobile firm that offers checking and savings
accounts. As a startup, Varo seeks to disrupt traditional banking (even of the
online-only variety) by providing monthly-fee-free accounts and an entirely mobile
experience.

Investopedia is committed to providing our readers with unbiased product

recommendations. We may receive compensation when you click on links to
products, but this doesn’t affect how we rate, review, and rank them.

Pros

 No-monthly-fee checking and savings accounts

 No-fee overdraft
 Access to 55,000 Allpoint ATMs
 Impressive savings rate

Cons

 No online platform
 Cash deposit only available through a third-party that charges fees
 No checks
 Only two deposit accounts available
Pros Explained
 No-monthly-fee checking and savings accounts – Varo delivers no-
monthly-fee checking and savings accounts. You will pay no monthly
maintenance fees, no overdraft fees if eligible, no in-network ATM fees, no
foreign transaction fees, no debit card replacement fees, and no transfer
fees. The biggest exception is a $2.50 out-of-network ATM fee, which is
easy to avoid by using one of the 55,000 in-network Allpoint ATMs.
 No-fee overdraft – While many institutions promise no overdraft fees,
Varo takes this one step further by covering overdrafts of up to $50 that
are the result of a debit card purchase, an online payment, a check, or a
transfer (but not an ATM or other cash withdrawal). You will pay no fee for
this coverage, and you can repay the overdraft with your next deposit
within 30 days. You must qualify for the No Fee Overdraft program by
receiving at least $1,000 in direct deposit each month and by making at
least five debit card transactions each month. If you don’t qualify or
overdraft for more than $50, your transaction will be declined, and you will
still pay no fees.
 Access to 55,000 Allpoint ATMs – Varo is part of the Allpoint ATM
network, which has 55,000 ATMs worldwide, 42,000 of which are within
the United States.
 Impressive savings rate – Savers with Varo can expect a
minimum annual percentage yield (APY) of 1.21% but may qualify for as
much as a 2.80% APY.

Cons Explained
 No online platform – Online-only banks with no physical branches are
hardly a novelty at this point, but Varo is also without an online platform.
The website outlines the details of available accounts, but all you can do
from the site is sign up for an account. From there, you will have to get the
mobile app to access your Varo account.
 Cash deposit only available through a third-party that charges fees –
If you need to deposit money into your Varo checking account, you will
need to visit a retailer that participates in the Green Dot network, such as
Dollar General, Walgreens, CVS, 7-Eleven, or Kroger (among others), and
pay up to $4.95 to add cash to your account at the register. Alternatively,
you can purchase a $5.95 MoneyPak at a participating Green Dot retailer
and deposit your cash onto it, which you can then transfer to your Varo
account. You cannot deposit cash directly into your Varo savings account
but must deposit it into your checking account and then transfer it to
savings on the mobile app.
  No checks – Varo does not offer paper checks with its checking account.
However, you send a check via the mobile app, which is mailed within
three to nine business days. There is no fee for this service.
 Only two deposit accounts available – Other than the checking and
savings accounts, Varo does not offer any other deposit accounts, such
as certificates of deposit (CDs), money market accounts, and the like.

Who is Varo Best For?

Varo will appeal to customers who prefer a mobile experience, want to avoid
fees, and want a competitive savings rate. Specifically, Varo will be right for
customers who:

 Are tech-savvy and enjoy handling their banking on their phone

 Want a fee-free banking experience
 Don’t often need to deposit cash
 Want a high interest rate on their savings account
 Don’t need more than the basic checking and savings account
 Want easy access to fee-free ATMs
 Don’t write many paper checks

What Does Varo Offer?

As a mobile-only startup, Varo keeps its offerings very simple. The only accounts
Varo has are savings and checking.

Savings Account
The sole Varo savings account is a high-yield account with no fees whatsoever
with which savers can earn up to a 2.80% APY. To open a Varo savings account,
you will first need to open a checking account (known as the ―Varo Bank
Account‖).

In addition, the fee structure is a little confusing. To earn the 2.80% APY, you will
need to meet the following three requirements:

 Make at least five debit card purchases each calendar month

 Receive $1,000 or more in direct deposits in the same calendar month
 Keep a daily savings account balance of up to $10,000

If you do not meet these requirements, your rate is 1.21% APY. This means that
savings account holders who keep a balance greater than $10,000 (but meet the
other two requirements) are not eligible for the 2.80% APY. Once you reach a
$10,000 balance or greater, your rate drops down to 1.21%. On the plus side,
there is no minimum balance required on the Varo savings account, and you
need no more than $0.01 in your account to earn interest.

Though you are required to have a Varo checking account in order to open the
Varo savings account, the institution offers some benefits with this structure.
Specifically, Varo has two automatic savings options to help encourage you to
reach your savings goals.

1. Save Your Pay – This program allows you to choose a percentage of each
direct deposit into your Varo checking account to have automatically
transferred to your Varo savings account.
2. Save Your Change – With this program, anytime you make a purchase
with your debit card, Varo will round up the purchase to the nearest dollar
and transfer that amount from your Varo checking account to your Varo
savings account.

Checking Account
The only checking account option is officially known as a ―Varo Bank Account,‖
and it packs quite an impressive punch for a fairly simple offering. The benefits of
this account include all of the following:

 No Monthly Fees – With no minimum balance, no monthly maintenance

fee, no overdraft fees or interest owed for overdrafts, no transfer fees, no
foreign transaction fees, and no debit card replacement fees, you really do
enjoy monthly-fee-free banking.
 Early Direct Deposit – If you set up direct deposit of your paycheck, you
may be able to access your money as much as two days earlier than
payday. That's because Varo will deposit your money in your bank account
as soon as it receives the direct deposit notification. You may also be able
to access the direct deposit of your tax refund up to two days early.
 No Fee Overdraft – If you receive at least $1,000 in direct deposits per
month and make at least five debit card purchases per month, you are
automatically eligible for No Fee Overdraft, wherein Varo will cover an
overdraft up to $50 with no fees and no interest owed. Your next deposit
within 30 days will reimburse the overdraft.
 No Overdrafts – Even if you do not qualify for No Fee Overdraft, any
transaction that would overdraw your account is declined. This means you
can rest assured that you will not be hit with an overdraft fee (that
averages $36 each at traditional banks) on top of your overdraft.
 Visa Debit Card – The Varo Bank Account comes with a Visa-branded
debit card that can be used anywhere Visa is accepted. With your debit
card, you can connect Apple Pay, Google Pay, PayPal, Cash App, and
Venmo for effortless payments anywhere. You are also eligible for the Visa
 Zero Liability guarantee, which ensures that you won’t be held responsible
for unauthorized charges on your debit card.
 Excellent App – As a mobile-only bank, Varo needs a great mobile app,
and it definitely delivers. The app allows you to deposit checks with mobile
check deposit, send money instantly to other Varo customers, track
spending and account activity with instant alerts, and even link external
accounts so you can transfer money as well as track your finances across
Varo and other financial platforms. It has a 4.8 star rating on iTunes and a
4.6 star rating on Google Play.1 2

While the Varo Bank Account has a lot to offer the right customer, it’s not going
to be a good fit for everyone. The fact that you have to pay a third-party to
deposit cash means that anyone who regularly receives cash may want to look
elsewhere for a basic checking account.

It’s also a good idea to double check if there are Allpoint ATMs in your area
before signing up for a Varo Bank Account. Through a network of 55,000 ATMs
(42,000 in the United States) covers a lot of territory, that doesn’t mean that
everyone can easily find an ATM near them. The one exception to this fee-free
account is the $2.50 out-of-network ATM fee, which could be an expensive
exception if there are no convenient Allpoint ATMs near you.

Varo Customer Service

Though Varo is a mobile-only bank, there is a robust help section on its website
that is both set up as an easy-to-use FAQ and easily searchable. If you are
unable to find a solution to your problem via the help section, you can email Varo
or call its customer service line from 8 a.m. to 9 p.m. EST Monday through Friday
and 11 a.m. to 7 p.m. EST Saturday and Sunday (excluding federal holidays).

How to Bank With Varo

Signing up for an account with Varo starts on its website. You will enter your
email and some other identifying information and create your account on the
website. From there, you will need to download the app to finish opening your
account. Without a smartphone or tablet, however, it is impossible to bank with
Varo.

Verdict
Varo does not have a wide array of products and services, but it makes sure that
what it does offer is excellent. The no-strings-attached fee-free accounts make
this a good option for young and newly banked customers, and the impressive
APY on the high-yield savings account can tempt even veteran savers.
The fact that Varo is only available on mobile and does not have a great solution
to the problem of cash deposits means this is not necessarily the right institution
for everyone. That said, Varo is an excellent competitor in the world of digital and
mobile banking.

Methodology
Investopedia is dedicated to providing consumers with unbiased, comprehensive
reviews of banks. We collected over 20 data points across more than 80 banks—
including products available, interest rates, fees, and accessibility—to ensure
that our content helps users make the right decision for their savings and banking
needs.