Market Overview

Varo Money Granted Preliminary Approval for National Bank Charter


Digital Banking Startup Makes History and Changes Course of Banking
as First Fintech to Receive Preliminary Approval for a National Bank
Charter from the OCC

The organizers of Varo Bank, N.A. today announced they have been granted
preliminary approval by the Office of the Comptroller of the Currency
(OCC) of their application to form a de novo national bank, putting Varo
on track to become the first all-mobile national bank in the history of
the United States.

"This is a historic moment and marks the start of a new era in banking,"
said Colin Walsh, co-founder and CEO of Varo Money. "We founded Varo
because we saw that banks weren't serving the majority of their
customers very well, and we wanted to fix that. So we decided to build a
bank from the ground up with the goal of improving consumers' financial
health through better technology and a more efficient business model."

Mobile-only banking with a mission

Varo has a social mission to lower the cost of banking and help
consumers improve their financial lives. A 2017 report from the Federal
Reserve showed that 40% of adults would not be able to cover an
unexpected expense of $400 without selling something or borrowing money.
Varo can improve the financial health of millions by helping them manage
expenses and save money by providing no-cost premium banking services
that are accessible through a smartphone.

Varo's all-mobile Bank Account is built with best-in-class technology
wrapped in an intuitive design and user experience. Varo offers

● Fee-free banking: No monthly maintenance fees, no foreign transaction
fees, no ATM withdrawal fees^

● Savings Accounts with 1.50% Annual Percentage Yield* with no minimum
balance requirement

● Automated tools to help build savings seamlessly

● Personal loans of up to $25,000 that may provide a lower-interest
alternative to credit cards**

● A view of all of a customer's financial accounts—at Varo and
elsewhere—in one place

● Customizable in-app spend tracking and the ability to set financial

● Live customer service, seven days a week

● A secure and safe way to bank using industry-leading levels of data

Varo customers pay no ATM fees at a network of more than 55,000 Allpoint
ATMs worldwide. Allpoint ATMs are located in popular retail stores—like
Target, Costco, Walgreens, and CVS—so customers don't have to go out of
their way to get cash at a bank branch ATM.

Varo Bank, N.A. is currently in formation and will obtain its final
national bank charter upon completion of organizational steps and
satisfaction of the OCC's conditions, as well as approval from the FDIC
to obtain insurance and Federal Reserve membership. Varo, as a new
national bank, will be able to deliver on its mission to help Americans
achieve better financial health nationwide, while offering customers a
full range of products and solutions with the highest standards of
consumer protection.

Built by leaders in both ‘fin' and ‘tech'

Varo was founded by Colin Walsh, CEO, and Kolya Klymenko, CTO, and
counts among its team the best talent from some of the world's leading
brands, including Amazon, American Express, Apple, Citi, McKinsey,
Instagram, and Wells Fargo.

"This preliminary approval from the OCC is a signal that regulators
recognize the value technology can bring to banking for all Americans,"
said Jo Ann Barefoot, CEO of Barefoot Innovation Group and formerly
deputy comptroller of the OCC and senior fellow at the Harvard Kennedy
School Center for Business and Government. "Technology is not only
lowering costs for consumers, but it's also adding new benefits such as
budgeting and money management that's seamlessly available on a
smartphone. The result is that more Americans will be empowered with
better tools to improve their financial health. Varo's success is a
breakthrough moment for consumer banking and is setting a new standard."

Varo was founded in 2015 and has raised more than $79M in funding, led
by Warburg Pincus and The Rise Fund, a global impact fund led by private
equity firm TPG.

^Non-Allpoint ATM owners may assess a fee for ATM withdrawals, but Varo
does not charge a fee.

*Varo's savings interest rate is variable and may change. The balance in
savings must be at least $0.01 to earn interest. The APY disclosed is
accurate as of 07.01.2018.

**Varo Personal Loan offered by Varo Money Inc. under state licenses;
subject to application approval. NMLS#1547251

Varo Bank Accounts are provided by The Bancorp Bank, Member FDIC.
Deposits are FDIC-insured up to $250,000 through The Bancorp Bank.

About Varo Money

Varo Money, Inc. ("Varo") combines mobile technology with a social
mission to provide access to no-cost premium bank accounts through
better service and automated savings tools. We believe everyone has a
right to high-quality banking at no cost regardless of net worth. In
addition to premium banking products offered through The Bancorp Bank,
Varo provides tech-first features to budget, track, and save money as a
way to help people manage their money more easily. Varo serves customers
without being tied to a branch and embraces technology to provide
helpful banking relationships. Based in San Francisco and Utah and
privately held, Varo has raised $79M to date, led by Warburg Pincus.
Varo Personal Loan and Varo Backup Line are offered by Varo Money, Inc.,
under state licenses, subject to application approval. For more
information, please visit
and follow Varo on Facebook @varomoney
or Twitter @varomoney.

Research cited:

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