San Francisco-based fintech startup Varo Money has been granted preliminary approval for a national bank charter by the Office of the Comptroller of the Currency (OCC), paving the way for the creation of the first fully-licensed mobile-only bank in the US.
Co-founded by former Wells Fargo executive Colin Walsh, Varo Money has raised $79 million in funding over the past two years and currently provides a range of savings, loans and account-based services through a relationship with The Bancorp Bank.
The approval for a Federal banking charter will enable the firm to expand its portfolio of millennial-friendly financial products on a national scale, providing a wider range of services in all 50 states.
CEO Walsh says a national bank charter will also allow Varo to streamline operations, lower banking and lending costs further, and increase the pace of customer-focused innovation.
“This is an historic moment and marks the start of a new era in banking,” he says. “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.”