In an unsual move for a US fintech startup, mobile-only banking outfit Varo Money is applying for a full national banking licence.
Founded by 25-year FS industry veteran Colin Walsh, the firm has applied to the Office of the Comptroller of the Currency for the charter and to the Federal Deposit Insurance Corporation to form Varo Bank.
Varo has already raised $28 million from Warburg Pincus to build its app, which hit the Apple App store last month. The service provides a debit card, deposit and lending products and promises to act as a "24/7 digital financial coach" that will offer proactive insights, analysis of spending and real-time budgeting.
Like the neo-banks, such as Moven and Simple, which came before it, Varo has had to rely on a partnership, with The Bancorp Bank.
But now it plans to go further, applying for a national bank charter to enable it to deliver on its promise of the first genuine nationwide American bank built specifically for the mobile age, offering customers access to a full range of products.
Says Walsh: "We founded Varo because we believe many people could benefit from an easier, more affordable way to manage their money and reach their financial goals with just a few taps on their mobile phone.
"To do this, we got customers involved in an iterative process from the beginning. We wanted to offer more than just checking, savings and lending products—we wanted to help our customers solve financial problems, fix the fundamentals, and guide them toward a better financial future. As a national bank, Varo will be able to help Americans nationwide."