Advertiser Disclosure

Varo Bank Review: Checking, Savings

Sept. 17, 2018
Banking, Banks & Credit Unions
varo-bank-review-checking-savings-story
NerdWallet adheres to strict standards of editorial integrity to help you make decisions with confidence. Some of the products we feature are from partners. Here’s how we make money.
We adhere to strict standards of editorial integrity. Some of the products we feature are from our partners. Here’s how we make money.

NerdWallet rating: 4.0/5.0

Where Varo shines:

  • No monthly fees, no overdraft fees.
  • Tools to track spending and make savings goals.
  • 1.75% APY savings account.
  • Get your paycheck early with direct deposit.

Where Varo falls short:

  • Varo currently available on iOS mobile app only.
  • Cash deposits are through a third-party service that charges fees.

Where Varo shines:

  • No monthly fees, no overdraft fees.
  • Tools to track spending and make savings goals.
  • 1.75% APY savings account.
  • Get your paycheck early with direct deposit.

Where Varo falls short:

  • Varo only available on iOS mobile app currently, so no access via desktop or Android app.
  • Cash deposits are through a third-party service that charges fees.

Where Varo shines:

  • No monthly fees, no overdraft fees.
  • Tools to track spending and make savings goals.
  • 1.75% APY savings account.
  • Get your paycheck early with direct deposit.

Where Varo falls short:

  • Varo only available on iOS mobile app currently, so no access via desktop or Android app.
  • Cash deposits are through a third-party service that charges fees.

 

The bottom line

Varo

at Varo,

Member, FDIC

Varo is a mobile-only banking app with a hard-to-beat combo: free checking and high-yield savings. Neither account has overdraft or monthly fees or minimum balance requirements. The app by Varo Money also includes a fee-free ATM network, budgeting tools and automatic savings programs. Since there are no branches, cash deposits are only available through third-party retailers that may charge a fee. And Varo isn’t available yet for Android app users.

Best if: You’re looking for one place for free checking, a high savings rate and budgeting tools.


Read on for details on Varo’s checking, savings and more.

Checking: 4.5/5.0


 
Upsides:

  • No fees or minimum balance for Varo’s main bank account.
  • Free access to thousands of ATMs. Varo is part of the Allpoint network, which has over 55,000 ATMs worldwide, with about 42,000 of them in the U.S. If you use a non-Allpoint ATM, the ATM operator may charge a fee, but Varo won’t.
  • No foreign transaction fees. Unlike many banks, Varo doesn’t charge a fixed or percentage fee on ATM withdrawals or debit card purchases abroad. Visa will determine the exchange rate on a foreign transaction.
  • Helpful budgeting tools. You can track spending and see Varo and non-Varo accounts on the app at once. Like Simple Bank’s Safe-to-Spend balance, Varo lets you see what you have left to spend after subtracting that month’s upcoming bills. In addition, the app has transaction alerts, savings goals and a calendar display for bill payments.
  • Direct deposits up to two days early. If Varo receives a payroll notification before your payday, it can deposit your money more quickly than many banks.

Downsides:

  • Cash deposits generally have fees. Since Varo doesn’t have branches, the only way to add cash directly to your account is by going to a retailer that participates in the Green Dot network, such as CVS, 7-Eleven or Walgreens. There’s a fee of up to $4.95 to add cash at their registers.
  • No checks. Like other mobile banks, Varo doesn’t provide checkbooks. Instead, you can use bill pay to have Varo send a check on your behalf to a company you need to pay. Delivery tends to be three to nine business days. Online bill pay is another option and it’s faster, typically taking one to two business days.

Savings: 4.5/5.0


 
Upsides:

  • The savings rate. It’s one of the highest for a mobile-only banking institution: 1.75% annual percentage yield for all balances. Mobile banks Simple and Chime, for example, only offer 0.01% APY. Like its checking account, Varo Money’s savings account is federally insured up to $250,000.
  • No fees. There’s no monthly fee or minimum balance requirement.
  • Two automatic savings programs. The first one, Save Your Pay, lets you opt for any percentage of your paycheck to go directly to your savings account. The other, Save Your Change, rounds up every checking transaction to the nearest dollar and transfers those cents to savings.

How does Varo compare?

Varo

Varo Savings Account

NerdWallet Rating

at Varo,

Member, FDIC

APY

1.75%

Monthly Fees

$0

Bonus features

Mobile-friendly

No Monthly Fee

Goldman Sachs Bank USA

Online Savings

NerdWallet Rating

at Goldman Sachs Bank USA,

Member, FDIC

APY

1.95%

Monthly Fees

$0

Bonus features

No Monthly Fee

Competitive APY

American Express National Bank

High Yield Savings Account

NerdWallet Rating

at American Express National Bank,

Member, FDIC

APY

1.90%

Monthly Fees

$0

Bonus features

No Monthly Fee

Competitive APY

Not for you? Read more bank reviews

 

Bank experience: 3.0/5.0


 
Upsides:

  • Highly rated iOS app. Customers rated Varo’s iOS mobile app 4.7 out of 5 stars.
  • Extensive customer service. You can call Varo for support weekdays from 6 a.m. to 9 p.m. and weekends 8 a.m. to 6 p.m. Pacific time. Varo also responds via email and on Twitter.

Downsides:

  • No Android app. As a mobile-only bank, Varo is available only to customers who have an iOS device. But the company expects to launch a beta version of the Android app this fall, and if you would like to know when, you can sign up for a waitlist on the company’s website.
  • No branches. Because Varo has no branches to visit, depositing cash generally requires paying a fee at retailers. Depositing checks via Varo’s free mobile check deposit service is subject to limits, which aren’t something customers usually encounter when depositing checks at a branch. The maximum is generally $2,000 per check for customers, but larger checks may be accepted in some situations. Contact Varo Money for such requests.

Overdraft fees 4.0/5.0


 
The upside:

  • No overdraft fees. Transactions that would cause a negative balance are declined.

The downside:

  • No overdraft line of credit. Having some access to credit can be helpful if it means you can cover an important bill. Banks that have this service charge interest on the overdrawn amount, which is generally cheaper than overdraft fees. Varo offers personal loans but doesn’t currently connect them with overdraft services.
Varo

at Varo,

Member, FDIC

» Ready to take the next step? Varo charges no fees and offers a high savings rate plus free budgeting tools. Compare similar mobile banks such as Simple (see our review) or Chime (see our review) or see more information below.

More on mobile banks and free accounts


Ratings methodology

NerdWallet’s overall ratings for banks and credit unions are weighted averages of several categories: checking, savings, certificates of deposit or credit union share certificates, customer experience and overdraft fees.

Factors we consider, depending on the category, include rates and fees, ATM and branch access, account features and limits, user-facing technology, customer service and innovation.

The stars represent ratings from poor (one star) to excellent (five stars). Ratings are rounded to the nearest half-star.

About the author