US-based mobile bank Varo Money has secured approval from the Federal Deposit Insurance Corporation (FDIC) for deposit insurance.
This approval marks a significant step in its application process for a national bank charter.
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In September 2018, Varo received preliminary approval from the Office of the Comptroller of the Currency.
With the FDIC insurance, Varo now has moved the charter process to the final step of the approval process.
Varo Money CEO Colin Walsh said: “Receiving an official bank charter has been part of Varo’s vision from the very beginning, and we are excited to progress through the necessary steps to accomplishing that goal.
“Despite historic economic growth, only 29% of Americans are considered financially healthy.
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By GlobalData“Becoming a fully chartered bank will give us greater opportunity to deliver products and services that positively impact the lives of everyday people around the country.”
Varo Money’s banking products and solutions include:
Since its launch in 2017, the mobile banking brand offers fee-free banking services such as zero balance accounts and no foreign transaction fees.
It allows free cash withdrawals at its more than 55,000 Allpoint ATMs worldwide.
Customers can also avail low-interest personal loans of up to $25,000. They can avail direct deposit and get paid up to two days early.
Through its no-fee overdraft service, qualified customers can overdraw up to $50 from their bank account without any charges.
Varo also offers Annual Percentage Yields (APYs) of 2.8% on its Varo savings account which applies to deposits up to $50,000.
OCC formerly deputy comptroller and Barefoot Innovation group CEO Jo Ann said: “Getting through this very high regulatory hurdle now opens the door for Varo to become the biggest mobile-centric national bank.
“It also opens the door to enabling tens of millions of Americans who have been underserved to gain access to affordable FDIC-insured banking, which will build financial health and security for individuals and communities.”
The bank selected Temenos’ T24 Core Banking and Lifecycle Management Suite in April last year to power its launch.
