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Published: Dec 12, 2023 15 min read

Varo Bank is a fintech company that offers online banking services. Founded in 2020, Varo’s digital-only products include a checking account, a savings account and a secured credit card. Additionally, Varo Bank offers small cash advances to its banking customers.

We thoroughly reviewed Varo Bank’s offerings, including pros and cons, annual percentage yield (APY), checking account perks and customer satisfaction. Read on to find out if Varo might be the right choice for your financial goals.

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Best high-yield savings account and checking combination

Varo has not only one of the best high-yield savings accounts, but also one of the best checking accounts — making it a solid option for people who want both accounts from one bank. There are no monthly fees for Varo’s savings or checking accounts or minimum opening deposit requirements.

The checking account from Varo includes features such as early direct deposit, online bill pay, Zelle integration and access to more than 40,000 fee-free ATMs. Customers also get up to 6% cashback on purchases made with their Varo debit card at select retailers.

For its high-yield savings customers, Varo offers a competitive annual percentage yield (APY) of up to $5,000. Varo also offers helpful savings tools, including the option to automatically round up your checking account debits and deposit the difference into savings.

Varo high-yield savings accounts pros and cons

Pros
  • High-yield savings and checking combination
  • Two automated savings tool options
  • Zelle integration for fast payments
  • Get cash advances of up to $500
Cons
  • Lower APY for the first month before you can qualify for higher APY
  • Highest annual percentage rate on high-yield account only applicable up to $5,000
  • $3 fee for using an out-of-network ATM

Pros explained

High-yield savings and checking combination

Varo offers an attractive all-in-one banking solution with its high-yield savings account and online checking combination. The high-yield account has a competitive annual percentage yield, and checking with Varo comes with plenty of perks.

Both accounts have no monthly fees, minimum balance requirements or overdraft fees. Additionally, neither account has a minimum initial deposit requirement. (Note that accounts with a zero balance for more than nine months may be subject to closure. Accounts with a negative balance for more than 60 days also risk closure.)

Two automated savings tool options

Varo offers two automated savings tools for connected high-yield savings and checking accounts. “Save Your Change” automatically rounds up checking account purchases and deposits the difference in your savings. With “Save Your Pay,” you can schedule a specific percentage of your paycheck to be deposited into your high-yield savings account. You can turn one or both of these tools on or off anytime.

Zelle integration for fast payments

You can send and receive money using Zelle in the Varo mobile app. With some payment platforms, such as PayPal or Venmo, you’re charged a fee to deposit into an account quickly. However, Zelle transactions are completed within minutes and don’t carry transaction fees.

Get cash advances of up to $500

Varo offers small loans from $20 to $500 for qualified customers through its Varo Cash Advance program. To qualify, you must receive $800 during the current or previous month in direct deposits in either your high-yield savings account or checking account. Varo also evaluates eligibility daily based on your account activity and history with repayments of previous cash advances. Approved cash advances are processed within minutes.

Below, you’ll find the rates for each cash advance amount.

Varo Cash Advance Fees
Cash advance amount Fee
$20 $1.60
$50 $4
$75 $6
$100 $8
$150 $12
$200 $16
$250 $20
$300 $24
$400 $32
$500 $40

Cons explained

Lower APY for the first month

Your first month with a high-yield savings account only qualifies for the lowest available annual percentage yield (APY). At the start of the next month, if you’ve received $1,000 or more in qualifying direct deposits, you’ll earn the highest APY available. You must continue meeting this requirement to receive the highest monthly rate. Additionally, your Varo checking account must have a positive balance at the end of each month.

Highest annual percentage yield only applicable up to $5,000

So long as you meet the requirements, you’ll receive the highest APY available on your high-yield savings account funds. However, funds that exceed $5,000 will automatically be downgraded to the lowest available APY. Tiered annual percentage yield rates are not uncommon in high-yield savings accounts, but many banks and fintech companies offer the same APY on all balances.

$3 fee for using out-of-network ATM

Unlike some banks that offer reimbursement of ATM fees, Varo charges customers a $3 fee if they use an out-of-network ATM. This cost is in addition to any fee the ATM operator may charge. You can avoid this charge by using only Allpoint ATMs, of which there are more than 40,000 throughout the U.S. in stores like CVS, Walgreens and Target.

Varo high-yield savings account offerings

Varo offers a fee-free high-yield savings account with a solid annual percentage yield compared to most types of savings accounts. However, you must also open a Varo checking account to open a high-yield savings account.

Varo also offers a secure credit card that can help you improve your credit score. Below, we discuss all of Varo’s offerings in detail.

High-yield savings account

Varo’s high-yield savings account stands out for its high annual percentage yield, as well as its lack of monthly fees. Also, there’s no initial deposit requirement, so you can start saving with any amount of funds.

It’s important to note that you must meet certain requirements before you earn the highest available APY. Varo determines eligibility monthly based on previous activity. In the month prior, you must have received at least $1,000 in direct deposits to your high-yield savings account, and your checking account must have a positive balance.

These requirements mean that, unfortunately, you cannot earn the highest possible APY in your first month — but you can qualify every month thereafter, so long as you meet the criteria. Additionally, Varo’s HYSA offers the highest available APY on balances up to $5,000. Funds that exceed this amount will earn an interest rate.

You can fund your account in a variety of ways:

  • ACH direct deposit
  • Transfers from external bank accounts
  • Transfers from digital wallets (e.g. Cash App, PayPal, Venmo)
  • Deposits from Zelle payments
  • Mobile check deposit via the Varo app
  • Cash deposit at Green Dot locations (subject to Green Dot fees)

Online bank account

Varo’s checking account boasts several attractive features, including no monthly fees and no overdraft charges. There’s also no minimum initial deposit required to open an account.

The account includes two savings tools for customers who open a Varo high-yield savings account. Both tools are optional, so you can turn them on or off whenever you like.

  • Save Your Pay - Designate a percentage of your direct deposits for automatic transfer from your checking account to savings
  • Save Your Change - Rounds up your checking account debits to the nearest dollar and deposits the difference in your savings account

Varo also offers cash advances of $20 to $500 for qualified customers. You must receive $800 during the current or previous month to qualify. Additionally, you must maintain a good repayment history to remain eligible. Approved cash advances are processed within minutes. The fees for cash advances range from $0 to $15.

Other features of the Varo online bank account include:

  • Early payday - Receive your payroll direct deposits up to two days early
  • Zelle integration - Send and receive funds within minutes
  • Up to 6% cash back on Varo debit card purchases at popular retailers - Past retailers have included Popeyes, McDonald’s, Macy’s, PetSmart and Forever 21.

Varo uses the AllPoint ATM network, which includes more than 40,000 ATMs across the U.S. Note, however, that there is a $3 fee from Varo for using an out-of-network ATM. This charge is in addition to any fee the ATM owner may impose. Varo does not reimburse these fees.

Varo Believe Secured Credit Card

Varo customers who need help building their credit can open a Varo Believe Secured Credit Card. The amount you put into the Varo Believe card account is how much you can spend. If you turn on Safe Pay, Varo will automatically pay your bill at the end of each month using funds from your Believe account. Varo reports your Believe card payment history to the three major credit bureaus: Experian, TransUnion and Equifax.

There is no minimum credit score requirement. In fact, you don’t need to have any credit history at all. Varo doesn’t conduct a credit check when you open a Believe card. However, to be eligible, you must have at least $500 in qualifying direct deposits to your Varo checking account in the last 30 days.

If you spend more than the funds in your account, Varo offers a grace period of 21 days to deposit the shortage. So long as the payment is made before the 21 days is up, it’s counted as on time.

You can manage your Believe card and see your credit score online or with the Varo mobile app.

Varo high-yield savings account pricing

Varo bank accounts are free. There are no minimum deposits to sign up or minimum balance requirements to maintain while your account is open. Additionally, there are no monthly maintenance, overdraft or foreign transaction fees. You can also avoid ATM fees by using U.S. Allpoint ATMs. (Otherwise, there is a $3 fee from Varo for out-of-network ATM use, in addition to any fee the ATM owner may charge.)

Varo high-yield savings account financial stability

The major credit rating agencies (e.g. Fitch, Moody’s) do not have listings for Varo Bank. Some information is provided by Varo Bank’s CEO in a 2022 press release, in which he indicated that the company would streamline its structure to increase profitability.

While this may create some unease for new customers, you should remember that Varo Bank is FDIC-insured. This means that the Federal Deposit Insurance Corporation (FDIC) guarantees up to $250,000 of funds in each account you have with Varo Bank.

Varo high-yield savings account accessibility

Learn more about how you can access customer support and other banking features below.

Availability

Varo bank accounts are available to people in all 50 states and the District of Columbia. To open an account, you must be 18 or older and have a valid Social Security Number (SSN) or Individual Tax Payer Identification Number (ITIN).

Contact information

Varo has limited customer support hours. You can use the chat feature in the Varo mobile app seven days a week, but representatives will only answer between 8 a.m. and 4:30 p.m. MT. You can also reach a representative by calling 1-877-377-VARO, Monday through Friday, during the same hours.

User experience

Varo is an online-only bank with no brick-and-mortar locations. You can open an account online or via the mobile app. Both are easy to use and feature an eye-catching design.

For Varo customers, the app provides the best banking experience. The online banking site has fewer features — for example, there is no customer support via chat. The Varo Bank app is available for iOS and Android devices.

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Varo high-yield savings account customer satisfaction

Varo Money is accredited by the Better Business Bureau and has an A- rating from the organization. The company earned 3.54 out of five stars based on approximately 300 customer reviews.

While the rating isn’t terrible, it’s important to note that the company has received more than 2,100 complaints on its BBB page over the past three years. Many reviews on the BBB page and other third-party review sites complain of sudden account suspensions and issues disputing fraudulent charges. It’s worth noting, though, that Varo closed at least 766 BBB complaints in the past year.

Varo High-Yield Savings Account FAQs

How does Varo savings work?

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Varo Savings works similarly to any online savings account. You sign up for the high-yield savings account online or via the mobile app, then begin earning interest on the funds in your account. However, you must also open a Varo checking account, and the highest available annual percentage yield is only available if you receive direct deposits of at least $800 monthly. Additionally, the highest APY is only applicable up to $5,000. Funds in excess earn a lower APY.

When can you move money out of your Varo savings account?

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You can move money out of your Varo savings account at any time. There is no limit on how many transfers you can make from your high-yield savings account to your Varo checking account. However, you cannot transfer from your Varo savings account to an external account. You must first move the funds from Varo savings to your Varo checking account and then transfer from there. Additionally, you can use your Varo debit card to withdraw up to $1,000 per day from your Varo checking account.

Is the Varo savings account good?

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The Varo savings account is a good option for people who want to combine savings and checking accounts in one bank. There are no fees for either account, and the high-yield savings account's annual percentage yield (APY) is competitive. However, recent customer reviews reflect poor customer service. We recommend you review account policies before making a decision.

How We Evaluated Varo High-Yield Savings Account

We researched Varo Bank’s online high-yield savings account and checking account to provide a comprehensive review of its products. We evaluated the company based on the following criteria:

  • Account offerings: We reviewed the features of Varo’s high-yield savings and checking accounts to see how these products stand out from the competition.
  • Pricing and fees: We analyzed Varo’s fees to provide details about its no-fee policies.
  • Financial stability: We evaluated Varo’s financial history and reviewed its press releases to learn about the company’s financial standing.
  • Accessibility: We evaluated who can access Varo’s high-yield savings account and how to contact the company if you need help with your account.
  • Customer satisfaction: We assessed third-party customer reviews for insight into the average customer’s experience.

Summary of Money’s Varo High-Yield Savings Account Review

Varo Bank offers a one-stop banking experience with its high-yield savings and checking account combination. There are no monthly fees or minimum initial deposit requirements with either account, plus no overdraft charges. The high-yield savings account offers a competitive annual percentage yield (APY) and the checking account comes with a handful of helpful features, such as automatic savings tools and up to 6% cash back on purchases from select retailers.

Other perks of the checking account include Zelle integration so that you can send and receive payments within minutes. You can also receive your payroll checks via direct deposit up to two days early. Additionally, Varo places no limits on how many transfers you can make from your high-yield savings to your Varo checking account, so you can easily access your funds.

However, Varo Bank has received many negative reviews on third-party sites. Before you decide to open an account, we recommend you first learn what is a high-yield savings account, then review Varo’s account agreement. Be sure to contact customer service with any questions you have.

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