Varo Bank
Varo Bank is a United States neobank that provides app-based deposit, payment, and personal-finance services under a national bank charter.
Last updated August 25, 2026
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Overview
Varo Bank is an American digital banking brand headquartered in Salt Lake City, Utah. It was created by Varo Money, a financial-technology company founded in San Francisco in 2015 by Colin Walsh. The business initially pursued a mobile-first banking model rather than operating a traditional branch network. Its application launched in 2017 and offered customers access to direct deposit, a debit card, online bill payment, and deposit accounts. The early service operated through a partnership with The Bancorp Bank, allowing Varo to offer banking products while it pursued its own regulatory structure. Varo's central strategic objective was to become a nationally chartered bank rather than remain solely a fintech program manager. The company began the national charter process in 2017 and raised additional private capital as it developed its platform. In 2020, Varo received approval to use federal deposit insurance and later that year obtained a national bank charter from the Office of the Comptroller of the Currency. This made Varo the first United States fintech company to receive a national bank charter. After receiving the charter, it acquired its approximately two million customer accounts from Bancorp and began operating as a directly chartered digital bank. The brand's proposition centers on convenient, low-fee banking delivered through a smartphone. Its listed offerings include checking and savings accounts, debit-card access, direct deposit, online bill payment, instant transfers through Varo to Anyone, and free tax-filing services. Varo has promoted the absence of overdraft, ATM, and minimum-balance fees as part of its effort to make everyday banking more accessible. Its products are intended for customers who prefer digital account management and rapid payments over branch-based banking. Varo expanded rapidly after obtaining its charter. By September 2021, the company had raised a reported $992 million in cumulative funding, including a $510 million Series E round led by Lone Pine Capital, and had approximately four million opened accounts. It also doubled its workforce during 2021 to about 700 employees. Growth was followed by a cost-reduction phase: in July 2022, Varo laid off 75 employees. The company also faced criticism in 2021 after some customer accounts were reportedly closed in error. Varo said it returned affected customers' funds and added $100 payments in response. The company has received recognition from business and technology publications, including Inc., Forbes, Fast Company, and CNBC. In 2025, Gavin Michael, formerly chief executive of Bakkt, was announced as Varo's incoming chief executive officer, while founder Colin Walsh was expected to remain on the board. Varo therefore combines the identity of a consumer fintech brand with the regulatory status and operating responsibilities of a federally chartered bank.
History
Varo Bank developed from Varo Money, a financial-technology company founded in San Francisco in 2015 by Colin Walsh. The business was established to provide consumer banking through a smartphone application rather than through branches. Walsh initially raised $27 million from Warburg Pincus and used the capital to build a mobile banking platform. The Varo application launched in 2017. Its initial capabilities included direct deposit, debit-card access, online bill payment, and deposit accounts. At this stage, Varo's accounts were provided through a relationship with The Bancorp Bank. The model enabled Varo to acquire customers and develop its technology while operating under a partner-bank arrangement. The company emphasized simple digital access and the absence of overdraft, ATM, and minimum-balance fees. In 2017, Varo began seeking its own national bank charter. This was a significant change from the usual fintech approach because it would make Varo a directly regulated bank rather than a technology company relying entirely on another institution's charter. To support its expansion, Varo raised a further $45 million from Warburg Pincus and The Rise Fund in 2018. Chad Brownstein and Russell Westbrook were also identified as early investors. The regulatory transition progressed in 2020. The Federal Deposit Insurance Corporation approved Varo's use of federal deposit insurance, and the Office of the Comptroller of the Currency later granted the company a national bank charter. Varo became the first fintech company in the United States to receive such a charter. Following the approval, Varo purchased its approximately two million customer accounts from Bancorp and moved into direct operation as a bank. Around the same period, the company relocated its headquarters from San Francisco to Salt Lake City, Utah. Varo then pursued rapid customer and organizational growth. By September 2021, it had reportedly raised $992 million in total funding, including a $510 million Series E round led by Lone Pine Capital. The company had approximately four million opened accounts and had doubled its workforce to roughly 700 employees. Growth also brought operational difficulties. In 2021, Varo was criticized after some accounts were closed in error. The company said the affected customers' money was returned and that each affected customer received an additional $100. The broader technology-finance market became more cost-sensitive in 2022. Varo responded with a workforce reduction of 75 employees in July, describing the move as a cost-cutting measure. Its consumer offering continued to include checking and savings accounts, debit cards, direct deposit, online bill payment, instant transfers through Varo to Anyone, and free tax-filing services. Varo received external recognition during the following years. The company was included in Inc.'s Best in Business recognition from 2021 through 2023, appeared in Forbes' Fintech 50, and was listed by Fast Company among the Most Innovative Companies in Finance in 2021. CNBC recognized it among the World's Top Fintech Companies in 2024. In 2025, Gavin Michael, previously the chief executive of Bakkt, was announced as the incoming CEO. Walsh was expected to continue as a board member, marking a leadership transition while preserving the founder's connection to the company.
- 2025
Chief executive transition announced
[1]Gavin Michael was announced as incoming CEO, with Colin Walsh expected to remain on the board.
- 2022
Workforce reduction
[1]The company eliminated 75 positions in a cost-cutting action.
- 2021
Customer base and workforce expand
[1]Varo reported approximately four million opened accounts and about 700 employees after doubling its workforce.
- 2020
Federal deposit insurance and national charter
[1]Varo received federal deposit-insurance approval and an OCC national bank charter, becoming the first United States fintech company to obtain one.
- 2020
Headquarters move to Salt Lake City
[1]Varo moved its headquarters from San Francisco to Salt Lake City, Utah.
- 2018
Additional private financing
[1]Varo raised a reported $45 million from Warburg Pincus and The Rise Fund.
- 2017
Varo mobile banking application launches
[1]The application introduced digital account access, direct deposit, debit cards, and online bill payment through a partner-bank arrangement.
- 2017
National bank charter process begins
[1]Varo began seeking a national bank charter so it could move beyond its initial partner-bank structure.
- 2015
Varo Money is founded
[1]Colin Walsh founded Varo Money in San Francisco to develop a mobile-first consumer banking business.
Products and positioning
A mobile-first, low-fee United States banking provider focused on accessible everyday banking, digital payments, and consumer deposit products.
Checking account · 2017
Varo Checking Account
A mobile-managed transaction account designed for everyday spending, direct deposits, debit-card use, and bill payment. Varo has positioned its checking service around straightforward access and low-fee banking, including no overdraft or minimum-balance fees as described in reference material.
Savings account
Varo Savings Account
A digital savings product accessible through the Varo mobile banking platform. It complements the checking account by allowing customers to hold savings within the same app-based banking relationship.
Payment card · 2017
Varo Debit Card
A debit card linked to Varo customer accounts for purchases and cash access. The card was part of the original mobile banking proposition and is also used with Varo's instant-transfer service.
Money transfer service
Varo to Anyone
An instant-transfer offering that allows Varo customers to send funds to any United States debit card, extending the platform's payment functionality beyond transfers between accounts held at the same institution.
Tax service
Free Tax Filing
A free tax-filing service included among Varo's consumer financial tools. It broadens the brand beyond deposit accounts and payments into adjacent personal-finance services.
Controversies
Brand decisions
2025
Leadership successionOtherBackground
Varo announced a change in chief executive leadership while retaining founder Colin Walsh's board involvement.
Action taken
Gavin Michael, formerly CEO of Bakkt, was announced as incoming chief executive.
Aftermath
The change marked a transition from founder-led executive management to a new external chief executive.
2022
Cost-cutting workforce reductionStrategyBackground
Following rapid growth in accounts and employees, Varo undertook a cost-reduction effort.
Action taken
The company laid off 75 employees in July 2022.
Aftermath
The reduction indicated a shift from rapid organizational expansion toward tighter cost management.
2020
Transition from partner-bank model to direct bankingStrategyBackground
After receiving federal deposit-insurance approval and a national bank charter, Varo no longer needed to rely exclusively on its original partner-bank arrangement.
Action taken
Varo purchased its approximately two million customer accounts from The Bancorp Bank and began operating under its own charter.
Aftermath
The transaction established Varo as a directly chartered digital bank rather than only a fintech provider distributing another bank's products.
2017
Pursuit of a national bank charterStrategyBackground
Varo initially operated through The Bancorp Bank but sought a direct national banking charter to control its banking infrastructure and regulatory relationship.
Action taken
The company began the charter application process with the Office of the Comptroller of the Currency.
Aftermath
The application ultimately resulted in Varo receiving the first United States national bank charter granted to a fintech company.
Recent events
- 2025
Gavin Michael announced as incoming Varo chief executive[1]
Leadership change
Gavin Michael, previously chief executive of Bakkt, was announced as Varo's incoming CEO. Founder Colin Walsh was expected to remain on the board.
- 2022
Varo reduces its workforce[1]
Other
The company laid off 75 employees as part of a cost-cutting effort.
- 2021
Varo raises Series E funding[1]
Other
Varo completed a reported $510 million Series E financing led by Lone Pine Capital, bringing reported cumulative funding to $992 million.
- 2020
Varo receives federal deposit-insurance approval[1]
Regulation
The Federal Deposit Insurance Corporation approved Varo's use of federal deposit insurance as the company advanced toward becoming a nationally chartered bank.
- 2020
Varo becomes the first fintech company with a United States national bank charter[1]
Regulation · Other
The Office of the Comptroller of the Currency granted Varo a national bank charter, allowing it to transition from a partner-bank model to direct bank operations.
Sources3 sources
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