Varo vs. Chime®: Which banking option is right for you?

Varo is an FDIC-insured online bank, and Chime is a fintech company with banking partners. Both have one checking and savings option, and neither has any physical branches. When comparing their online banking options side by side, they’re both affordable and accessible accounts, but Varo has rewards, while Chime has more extra features.

Varo vs. Chime: A quick comparison

Bank	Varo	Chime
	Go to site	Go to site
Bonus	$25 referral bonus	$100 referral bonus for Chime checking account
Savings	APY: Up to 5%	2.00% Annual Percentage Yield (APY)
Checking	Monthly fee: $0 Minimum deposit: $0	Monthly fee: $0 Minimum deposit: $0
CDs	N/A	N/A
ATMs	Total ATMs: 40,000 Allpoint network ATM fee: $0 within network, $3.50 out-of-network cash withdrawal fee	Total ATMs: 60,000 MoneyPass and Allpoint network ATM fee: $0 within network, $2.50 out-of-network cash withdrawal fee
Branches	Online only	Online only

• Chime terms and conditions

  Chime is a financial technology company, not a bank. Banking services and debit card provided by The Bancorp Bank N.A. or Stride Bank, N.A., Members FDIC.
  ATMs: Out-of-network ATM withdrawal fees may apply except at MoneyPass ATMs in a 7-Eleven, or any Allpoint or Visa Plus Alliance ATM.
  Deposit: Once the retailer accepts your cash, the funds will be transferred to your Chime Checking Account. Cash deposit fees may apply if using a retailer other than Walgreens and Duane Reade.
  Mobile Deposit: Mobile Check Deposit eligibility is determined by Chime in its sole discretion and may be granted based on various factors including, but not limited to, a member's direct deposit enrollment status.
  Chime Savings Account: Chime Checking Account is required to be eligible for a Savings Account.
  APY: The Annual Percentage Yield (“APY”) is variable and may change at any time. The disclosed APY is accurate as of May 22, 2023. No minimum balance required. Must have $0.01 in savings to earn interest.
  Get Paid Early: Early access to direct deposit funds depends on the timing of the submission of the payment file from the payer. We generally make these funds available on the day the payment file is received, which may be up to 2 days earlier than the scheduled payment date.
  Credit Builder: To apply for Credit Builder, you must have an active Chime® Checking Account.
  SpotMe: Chime SpotMe is an optional, no fee service that requires a single deposit of $200 or more in qualifying direct deposits to the Chime Checking Account each at least once every 34 days. All qualifying members will be allowed to overdraw their account up to $20 on debit card purchases and cash withdrawals initially, but may be later eligible for a higher limit of up to $200 or more based on member’s Chime Account history, direct deposit frequency and amount, spending activity and other risk-based factors. Your limit will be displayed to you within the Chime mobile app. You will receive notice of any changes to your limit. Your limit may change at any time, at Chime’s discretion. Although there are no overdraft fees, there may be out-of-network or third party fees associated with ATM transactions. SpotMe won’t cover non-debit card transactions, including ACH transfers, Pay Anyone transfers, or Chime Checkbook transactions. See Terms and Conditions.

Varo vs. Chime products

Chime launched in 2014, and Varo became a bank in 2020, so Chime has a bit of a leg up in terms of industry experience. Both online banking options have FDIC insurance coverage on their deposit accounts up to the typical amount of $250,000.

Varo and Chime each have one checking and one savings account. Each also uses the Allpoint ATM network, but Chime also uses the MoneyPass network so it has around 20,000 more fee-free ATMs. And while Chime and Varo are online banking options, they both accept cash deposits at Green Dot retail locations for a $4.95 fee per deposit.

Banking

Chime and Varo’s banking products are very similar. Both checking accounts have no monthly fees, foreign transaction fees or overdraft fees, and neither requires a minimum opening deposit or balance. Additionally, having a Varo or Chime® checking account unlocks their respective savings account, both of which also have no monthly fees. However, neither Varo nor Chime supports joint bank accounts.

Varo’s checking account offers perks like early direct deposit, Zelle integration for peer-to-peer transfers, and cashback rewards of up to 6% with select brands. Varo also has its Varo Believe credit-building card that offers cash advances up to $500 and reports to all three credit bureaus to build credit history. The optional Varo savings account gets unlocked with the checking account, offering up to 5% APY on your first $5,000, and balances over $5,000 earn 3% APY. To earn the 5% rate, you must have a monthly direct deposit of at least $1,000 and end the month with a positive balance.

Similar to Varo, the Chime Checking account also has early direct deposits and an optional savings account with up to 2.00% APY. Chime has extra perks like its overdraft service SpotMe®, the Chime Credit Builder Secured Visa® Credit Card to build credit history and MyPay cash advances. However, to access SpotMe, MyPay and the credit-builder card, you’ll need monthly direct deposit of at least $200.

Borrowing

Chime and Varo’s borrowing options are similar, each offering a secured credit-building card and cash advances.

Varo’s borrowing options are:

• Varo Advance. With a Varo checking account, you can apply for a cash advance up to $20 to $250 and, over time, may qualify for higher amounts up to $500. Cash advances are deposited into your Varo Bank Account within seconds if you qualify. You must have direct deposits of at least $800 from the current or previous month to qualify. Cash advance fees range from $1.60 to $40, depending on your borrowing amount.
• Varo Believe. Varo’s secured credit-building card with no monthly fees, no APR and no hard credit check. It’s linked to a Varo Believe Secured Account that acts as a security for the secured card, and the amount in that account sets the spending limit. Varo reports to all three credit bureaus.
• Varo line of credit (waitlist). Personal lines of credit between $600 to $2,000 with terms up to 12 months, no late or prepayment penalties and a flat origination fee. However, this product isn’t available at the time of writing, but you can join its waitlist once you have a Varo Bank Account.

Chime’s borrowing options include:

• Cash advances. Offers cash advances of $20 to $500 between paydays. Cash advances are deposited into your Chime checking account, and you may qualify for cash advances if you have direct deposit of at least $200 per month. There are no fees, but instant delivery is $2.
• Chime Credit Builder Secured Visa® Credit Card. Available for Chime Checking Account holders with at least $200 in monthly direct deposit, this credit-building secured card has no APR, monthly fees or hard credit check. You move money from your Chime checking account to the card, so your spending limit is only what you deposit. Chime reports to all three credit bureaus.

Apps, features and more

Chime and Varo are both modern online banking options with lots of bells and whistles.

With Chime’s checking and $200 in monthly direct deposit, you can access most of what Chime offers, like SpotMe, MyPay and its secured card. A unique feature, Chime offers early delivery of federal tax refunds up to six days in advance and early payday deposits up to two days ahead of schedule. Chime also accepts cash deposits at more than 90,000 Green Dot retail locations. With the optional savings account, you can activate Round Ups to round up each debit card purchase to the nearest dollar, and Chime automatically sends the rounded-up amount to your savings.

Varo has many of the same things Chime has, except the SpotMe feature. You can earn up to 6% cash back with your debit card from select brands, including Nike, Macy’s and Petsmart. Varo also has an automatic savings round-up option called Save Your Change, early direct deposit, cash advances and a credit-building card. And just like Chime, Varo accepts cash deposits at Green Dot locations for a fee.

What Varo has over Chime is its savings account APY. Varo’s 5% rate is much higher than Chime’s 2.00% APY, but to get Varo’s highest rate, you must direct deposit at least $1,000 per month, and the 5% rate is only applied to your first $5,000.

How Varo and Chime’s fees compare

Going with Varo or Chime means you can get a checking and savings account with no monthly maintenance fees, balance requirements, overdraft fees or foreign transaction fees.

Chime has a $2.50 out-of-network cash withdrawal fee, which is lower than Varo’s $3.50.

Varo charges a fee for cash advances between $1.60 and $40, but they’re delivered instantly. Chime doesn’t charge any fees for its cash advances, but if you don’t want to wait up to two days, you’ll shell out $2 for instant delivery.

What customers say about Varo and Chime

Varo holds an A- rating with the Better Business Bureau (BBB), and Chime doesn’t have a BBB rating at the time of writing. Chime has nearly four times as many BBB complaints as Varo has, with Chime customers logging complaints over 8,000 in the last few years.

Most of Chime’s complaints are due to accounts being closed unexpectedly, lags in customer support and struggles to resolve fraudulent charges. On Reddit, it’s a mixed bag, with many customers saying they’ve been with Chime for years with no issues, and others commonly say that Chime’s customer support is poor. Many Redditors call out the Chime credit-builder card, saying they’ve seen marked increases in their credit rating.

For Varo, many of its complaints are typical bank complaints, with reports of deposits or withdrawals taking a while to process or failed attempts to get refunds for fraudulent charges. On Reddit, Varo’s reputation is pretty great. Most customers say they’ve had their accounts for years with no issues or complaints, and any issues that have cropped up have been resolved quickly. Others also note that Varo is one of the few online banking options that’s a full-fledged FDIC-insured online bank instead of a fintech company like Chime, which gives customers more peace of mind (though Chime’s deposit accounts are still FDIC-insured).

Final verdict: Chime wins

At the end of the day, Chime is a slightly better option if you want to access the extra perks like SpotMe, cash advances and a credit-builder card.

Varo requires a high deposit of at least $800 per month to access cash advances, which also have a fee. Chime only requires $200 in monthly direct deposits to access fee-free cash advances, SpotMe and its credit-builder card. Chime has early direct deposit, early federal tax refund deposits and savings round-ups, and it has more fee-free ATMs than Varo, with a smaller out-of-network ATM fee.

But if you want a higher savings APY and cashback rewards, Varo is the better option. It’s 5% APY on your first $5,000 is much higher than Chime’s 2.00% APY for its savings account. Also, Chime doesn’t offer any cashback rewards, so while Varo’s 6% has limits and is only for select brands, it’s better than Chime’s nothing. However, keep in mind that to get Varo’s 5% APY, you need direct deposit of at least $1,000 per month, whereas Chime’s 2.00% savings APY doesn’t have any requirements.

Both Chime and Varo have a credit-building secured card if you have their respective checking accounts and meet requirements, but they’re also not your only options for no-interest cards that build credit.

Chime at a glance

Varo at a glance

Alternatives to Varo and Chime

Chime and Varo often top our list of the best online banks, but they’re not without fault. Chime and Varo don’t have investing options, CDs or physical branches, and they also lack variety in terms of checking and savings account options.

• SoFi®. A top competitor to Chime and Varo, SoFi is an FDIC-insured online bank with its hybrid checking and savings account with no fees. SoFi also has an investing platform, unlike Varo or Chime, and it has personal loans, student financing, interest-bearing checking, up to 4.20% APY on savings if you meet activity requirements and much more.
• Fizz. A fintech like Chime, Fizz offers a secured card that’s backed by your external bank account. The Fizz card has no APR or hard credit check, and it reports to all three credit bureaus to build credit history.
• Chase. If you prefer in-person banking and more variety in checking options, consider Chase. It has a large variety of checking, savings, borrowing, investing and credit card options. It also has over 4,700 branch locations across the US.

See how even more bank accounts stack up:

• 10 banks like Chime
• 9 banks like Varo
• 8 banks like SoFi
• SoFi vs. Chime
• Ally vs. Chime