Varo saves of $100 mn with No Fee Overdraft for Hardworking Americans
By Pavithra R
Varo, the first mobile-centric national bank charter, has announced that the firm has saved its customers more than $100 mn in overdraft fees during the past year and is committed to supporting hardworking Americans as the country waits for an economic reset.
The economic uncertainties caused by the COVID-19 pandemic has resulted in many American households experiencing cash flow volatility and financial insecurities. Through its collaboration with The Bancorp Bank, Varo is continuing to provide significant savings to Americans with its No-Fee Overdraft (NFO). NFO allows qualified customers to overdraw their bank account up to $50 with no fees. A large number of banks are gouging consumers by collecting overdraft related fees. Varo knows that these practices can adversely affect the financial health of consumers and is paving the way with innovative banking services to help everyone make the most of their money.
“Fees, such as overdraft, are often charged to consumers who can least afford them, a model that Varo is fundamentally opposed to. Over the past year, Varo customers have been able to benefit from our No-Fee Overdraft – offering a short-term bridge to help our customers stretch their finances to the next paycheck. It’s a clear example of our vision for a better way to bank for everyone,” said Colin Walsh, founder, and CEO of Varo Money.
Beyond NFO, Varo offers premium banking for improving customers’ financial health, including paying interest on savings accounts and auto-savings tools to build financial resilience.
“Overdraft fees often cover the costs of offering “free checking.” This typically means that the people who can least afford it are subsidizing banking for everyone else. We need financial products that can still give households quick and easy access to small-dollar credit, but in a way that is more fair, more equitable, and without the punishing price-tag,” said Mariel Beasley, co-founder of the Common Cents Lab.
Recently, Varo has gone live with Temenos Cloud technology.
Founded in 2015, Varo’s mission is to redefine banking, enabling everyone to make smart choices with their money. The FinTech has built its fully digital banking solution from the ground up faster than originally planned. Launched its banking services officially in July 2017, offering premium banking products through The Bancorp Bank, Varo helps Americans stretch their money with bank and savings accounts that have no minimum balance requirement and no monthly account fees.
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