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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- or low-fee cash advance: Varo Advance provides up to $100 as an advance for qualified account holders. Advances of $20 have no fee, while advances of more than that have fees ranging from $3 to $5. You must qualify for the Varo Advance program by receiving at least $1,000 in direct deposit each month and by making at least five debit card transactions each month.
Access to 55,000 Allpoint ATMs: Varo is part of the Allpoint ATM network, which has 55,000 ATMs worldwide, more than 40,000 of which are within the United States.
Impressive savings rate: Savers with Varo can expect a minimum annual percentage yield (APY) of 0.50% but may qualify for as much as a 3.00% 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 $5.95 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 can send payments through the mobile app. 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, from which savers can earn up to a 3.00% 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 3.00% 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 0.50% 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 3.00% APY. Once you reach a $10,000 balance or greater, your rate drops down to 0.50%. 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.

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.
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.
Varo Advance: 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 Varo Advance, allowing you to receive cash advances of up to $100. Advances of $20 have no fees, but fees range from $3 to $5 for advances of more than that.
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. Replacement cards are free, unless you require expedited shipping, which will cost you $25.
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 4.2-star rating on Google Play.

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. Though a network of 55,000 ATMs (40,000+ 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. ET Monday through Friday and 11 a.m. to 7 p.m. ET Saturday and Sunday (excluding federal holidays) at 1-800-827-6526.

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.