Varo Bank Review: Checking and Savings

Varo has a tiered rate: 5.00% APY on the first $5,000 when certain conditions are met, and 3.00% APY for anything over $5,000 or on the entire balance when conditions aren’t met. To compare, the national average for savings accounts is just 0.43% APY.

The conditions: To earn the 5.00% APY for balances up to $5,000, you must receive at least $1,000 in total qualifying direct deposits and your checking and savings balance must be positive at the end of the month. You’ll need to meet those requirements in the current month to qualify to earn 5.00% APY for the following month. See below for more information from Varo.

There's no monthly fee or minimum balance requirement for the Varo savings account. It also offers two automatic savings programs that are linked to Varo’s bank account. The first one, Save Your Pay, lets you opt for a percentage of your direct deposit to go directly to your savings account. The other, Save Your Change, rounds up banking transactions to the nearest dollar and transfers those cents to savings.

Varo allows an unlimited number of savings transfers and withdrawals, which you won’t find at all banks. But it does have limits on the amounts: Transfers to external accounts are limited to $5,000 per transfer and $10,000 per month. But wire transfers are not available, and Varo does not offer joint accounts.

Varo accounts are insured by the Federal Deposit Insurance Corp. The FDIC insures up to $250,000 per depositor, per ownership category, per institution. That means that your Varo savings account and banking account are insured, combined, up to $250,000.

» Have more cash you want to protect? Learn how to insure your money when you’re banking over $250K

There is no monthly fee or minimum balance required for Varo’s banking account, which comes with a Visa debit card. Varo Bank is part of the Allpoint network, which has over 55,000 fee-free ATMs all over the U.S., Puerto Rico, Canada, Mexico, Australia and the United Kingdom.

»Want to see how Varo stacks up? Check out NerdWallet's comparison of Varo vs. Chime

Unlike many banks, Varo doesn’t charge a foreign transaction fee on ATM withdrawals or debit card purchases abroad. Note that Visa will determine the exchange rate on foreign transactions.

If you use a non-Allpoint ATM, Varo will charge you $3.50, in addition to any fees charged by the ATM owner.

If Varo receives a direct deposit notification before your payday, it can deposit your money early, often up two days ahead of schedule. See below for more information from Varo.

Cash deposits at Varo are tougher. Because 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 $5.95 to add cash and limits on the amount of cash you can deposit, generally from $500 to $1,500, depending on the retailer.

» See how Varo stacks up: Check out our picks for the best online banks

The Varo mobile app lets you track spending with Varo and non-Varo accounts combined. In addition, the app offers transaction alerts and lets you lock your debit card if it’s lost or stolen.

Customers rated Varo’s iOS app 4.9 out of 5 stars and Android app 4.7 out of 5 stars.

There may not be any branches, but you can call Varo for support on weekdays from 7 a.m. to 6 p.m. and on weekends from 7 a.m. to 3 p.m. Mountain time. Varo also responds via email and on Twitter.