Where have all of the high APYs gone? Since the drop in Fed Fund rates, deposit yields have declined as well.
But there are still places to find a high Annual Percentage Yield (APY) on Savings and Varo Bank is one of them. You can qualify to earn up to 3.00% APY* on a balance as little as a penny with a Varo Savings Account..
Varo Bank N.A., Member FDIC, is a modern fintech. This means it doesn’t have branches and you can’t easily deposit cash into your accounts. But if you are good with all of that, you could earn a strong yield on your deposits. In this article, we’ll go through what Varo Bank has to offer, along with some of its limitations.
- Online-only bank with competitive rates and no fees
- Free ATM access at over 55,0000 Allpoint® ATMs
- Get your paycheck up to two days early with direct deposit
Varo Bank Details
Up to 3.00% APY
Online Bank Accounts
Who Is Varo Bank?
Varo Bank is an online bank that offers several deposit and loan products. It was founded in 2015 and is based in San Francisco. Colin Walsh is the CEO and Founder.
“As the first Fintech with a national bank charter, and within the regulated system, Varo will be able to offer a range of tech-driven products, solutions, and experiences that no Fintech and no traditional bank can," said Walsh in an interview with CrowdfundInsider.
Walsh also promised that the Varo Bank platform would "power true financial innovation across a range of payments, deposit, and credit products, along with advanced personalization, predictive insights, and virtual communities.”
What Do They Offer?
Varo Bank is an online-only bank. If you prefer dealing with your bank in-person, Varo is probably not a good choice. It also has no monthly fees on its Bank and Savings Accounts. You won’t be charged any of the following with a Varo Bank Account:
- Overdraft fees
- ATM fees at 55,000+ Allpoint® ATMs in stores like Target, Walgreens, and CVS**
- Foreign transaction fees
- Monthly maintenance fees
- Transfer fees
They also offer cash advances into your Varo Bank Account at the tap of a button with the Varo Advance Account. Once you qualify, you can get up to $100 right in the Varo Bank app. To qualify:
- Your account must be at least 30 days old with a balance of $0.00 or more.
- You must receive qualifying direct deposits in your Varo Bank Account and/or your Varo Savings Account of at least $1,000 over the past 31 days.
- Your Varo Bank Account and/or Savings Account must not be overdrawn, and your Varo Bank Account can’t be suspended or closed.
For $20 Advances, your qualifications will be evaluated daily. For Advances over $20, fees apply, and your payment history and qualifications will be reviewed monthly for any credit limit increases. To continue to qualify for Advances, payments must be made timely. Here's more information on qualifying direct deposits and fees for Advances over $20.
Varo has a two-tiered savings account that pays interest on a balance as low as a penny. The first tier earns 0.20% APY* on a balance as little as a penny. The second tier pays 3.00% APY*, but you must meet these requirements each qualifying period^ to receive that APY:
- Make at least five qualifying Varo Bank Visa® Debit Card purchases AND
- Receive qualifying total direct deposits of $1,000 or more
- You must also ensure that:Keep your Bank Account and Savings Account balances greater than or equal to $0.00 AND
- Do not exceed a daily savings balance of $5,000 at close of business on each calendar day for the entire calendar month
That last requirement might sound odd. But you can’t go over a $5,000 balance or you’ll lose the higher APY.
Varo can also help you save money automatically. You can move a percentage of your online checking account direct deposit into your Savings Account. This is called Save Your Pay. You can also use Save Your Change, which will round up a purchase made with your Varo Bank debit card to the nearest dollar and transfer the difference to your Savings Account.
Varo Bank Account
With the Varo Bank Account, you can get your paycheck with direct deposit and access it up to two days earlier than the average direct deposit.
Early access to direct deposit funds depends on timing of the payer’s submission of deposits. Varo generally post such deposits on the day they are received which may be up to 2 days earlier than the payer’s scheduled payment date.
There is a $2,500 per calendar day spending limit with your Varo Bank Visa® Debit Card. There is also a $1,000 per calendar day maximum cash withdrawal amount. If you lose your debit card, it can be locked right from the Varo Bank mobile app.
No Fee-Free Cash Deposits
If you deal with cash, Varo Bank may not be what you're looking for. There isn’t a way to directly deposit cash with Varo. Instead, you have to go to a Green Dot Network® location such as Walmart, CVS, Rite Aid, Walgreens, 7-11, Dollar General, Family Dollar, Albertsons, Safeway, Kmart, or Kroger.
These businesses charge a fee to deposit your cash. You can also purchase a Green Dot MoneyPak, but there may be a fee charged by merchants for that as well. These fees range from $4.95 to $5.95. Additionally, there is a limit on cash deposits of $1,000 per day with a maximum of $5,000 per month.Withdrawing cash is much more convenient, however. You can get cash fee-free at over 55,000 AllPoint ATMs, with a limit of $1,000 per day. You also can ask for cash back at the register when using your Varo Bank debit card.
Up To 3.00%
55,000+ Free ATMs
38,000+ Free ATMs
91,000 Free ATMs
Are There Any Fees?
Varo charges a few fees, but none of them are hidden. They’ll charge a $25.00 fee for express shipping of replacement debit cards, and a $2.50 ATM withdrawal fee if you use a non-Allpoint ATM. The ATM operator may charge an additional fee.
There are fees for getting a Varo Advance above $20. You can see them here.You may be charged a fee by a retailer should you choose to use a Green Dot Reload @ the RegisterTM to deposit cash to your Varo Bank account.
How Do I Open An Account?
You can visit the Varo Bank website to open an account online. Click the purple "Get Started" button and then simply follow the prompts. Varo says that the application process shouldn't take longer than five minutes. You can also apply by downloading the purple Varo Bank app from your app store and following the prompts on screen.
Is My Money Safe?
Yes, Varo Bank is an FDIC member bank. With FDIC insurance, you get up to $250,000 of federal deposit protection per account (owned by one person with no beneficiaries). Also, all of your information is protected with 256-bit AES encryption technology.
Is It Worth It?
If you don’t deal with cash often or need branches, then Varo Bank could definitely be worth it for the high APY. In fact, it has one of the highest yields currently available.
And with no monthly fees on Varo Bank Accounts (regardless of your account balance), no foreign transaction fees, and once you qualify, cash advances in the app, there really is a lot to love about Varo Bank.
But Varo won't be a good fit if you deposit cash often or need branch access. If that's you, you'll probably want to look for high-yield savings or free checking options at full-service banks or credit unions.
Varo Bank Features
Online Bank Accounts and Line of Credit
0.20% To 3.00% APY
Foreign Transaction Fees
None (overdraft transactions will be declined)
Debit Card Replacement Fee
None for regular shipping, $25 for express shipping
None (online-only bank)
55,000+ fee-free AllPoint® ATM network
Customer Service Number
Customer Service Hours
Mon-Fri, 8 AM to 9 PM (EST)
Weekends, 11 AM- 7 PM (EST)
Mobile App Availability
iOS and Android
* Annual Percentage Yield (APY) is accurate as of March 23, 2021. All Varo Saving Accounts earn 0.20% APY. APY is variable and is subject to change. No minimum balance required to open account. Balance in Savings must be at least $0.01 to earn interest. To earn 3.00% APY, the Varo Savings Account must meet these requirements: Account Holder must make at least five Varo Visa® Debit Card purchases in each Qualifying Period and must receive total qualifying direct deposits of $1,000 or more to a Varo Bank Account or Varo Savings Account in each Qualifying Period. The Qualifying Period is defined as the 1st day of the calendar month through the last business day of the month. In addition, the Varo Bank Account and Varo Savings Account balances must not drop below $0.00 on any calendar day of the month, and the daily balance in the Varo Savings Account at close of business on each calendar day of the month must not exceed $5,000.
** There is no fee to withdraw money from any Allpoint® ATM. There is a $2.50 ATM cash withdrawal fee assessed by Varo Bank for all non-Allpoint® ATM transactions (out of network transactions). The ATM operator may charge an additional fee.
^ The qualifying period begins the first calendar day of the month and ends at close of business on the last business day of the month.
Varo Bank Review
Fees and Charges
Ease of Use
Tools and Resources
Products and Services
Varo Bank is an online-only bank that charges no fees, pays a high APY on deposits, and offers automatic savings tools.
- High APY on savings account
- No monthly bank account fees
- Cash Advance for qualifying custoemrs
- Early access to direct deposit paychecks
- No brick-and-mortar branches
- No fee-free cash deposits
Robert Farrington is America’s Millennial Money Expert® and America’s Student Loan Debt Expert™, and the founder of The College Investor, a personal finance site dedicated to helping millennials escape student loan debt to start investing and building wealth for the future. You can learn more about him on the About Page, or on his personal site RobertFarrington.com.
He regularly writes about investing, student loan debt, and general personal finance topics geared towards anyone wanting to earn more, get out of debt, and start building wealth for the future.
He has been quoted in major publications including the New York Times, Washington Post, Fox, ABC, NBC, and more. He is also a regular contributor to Forbes.