Varo vs. Chime: Which Is Better for You?

Varo and Chime have comparable offerings with a few key differences. Varo is a bank, and Chime is a neobank — an online-only financial service company that partners with a bank to provide account insurance.

Here’s how the two companies compare with each other.

Checking account

• No monthly maintenance fee or minimum balance requirement for either Varo or Chime.

• Varo and Chime both have early direct deposits.

• Cash deposits at Varo and Chime could be pricey, although cash deposits at Walgreens are free with Chime.

Savings account

• With Varo, customers can earn up to 5.00% annual percentage yield on balances up to $5,000 when certain conditions are met. Alternatively, customers can earn 0.50% APY without meeting those conditions or for balances over $5,000.

• Chime offers a 0.50% APY on its High Yield Savings account.

Overdrafts, ATMs and customer service

• Chime’s SpotMe® overdraft service allows customers to overdraft up to $200 with no fee if they meet some account requirements.

• Varo doesn’t allow overdrafts, but it has a cash advance program.

• Varo customers have access to more than 55,000 fee-free Allpoint ATMs.

• Chime customers can access more than 60,000 fee-free MoneyPass, Allpoint and Visa Plus Alliance ATMs.

• Varo and Chime are both online-only and don’t have branches.

• Varo and Chime both have strong mobile app ratings.

You want a stellar interest rate on savings and can meet the requirements to get there.

You want a strong interest rate on savings and a flexible overdraft service.

Varo Bank Account. The Varo Bank Account has no monthly fees or minimum balance requirements. In addition, customers have access to the Allpoint ATM network, which has more than 55,000 free ATMs where customers can withdraw cash. However, depositing cash is more complicated; Varo customers have to go to a Green Dot retailer such as Walgreens or Safeway and may be charged a fee of up to $5.95. Customers can also get their paychecks up to two days early with direct deposit.

Chime Spending Account. Chime doesn’t charge monthly fees or require a minimum balance on its Spending Account. It also has a savings program where customers can round up their purchases to the nearest dollar and save the difference. In addition, Chime customers can make fee-free withdrawals at more than 60,000 nationwide ATMs. Chime is also part of the Green Dot network, so customers can make cash deposits at certain retailers for a fee or at Walgreens for free.

Varo Savings Account. Customers start at a baseline of 0.50% APY as long as they keep a certain amount in their account every month, but they can earn 5.00% on up to $5,000 if they have $1,000 or more in direct deposits per month. Varo has two automatic savings programs: the first allows customers to take a percentage of the direct deposits in their checking account and transfer it to their savings. The other program enables customers to save upon making a purchase. Varo will round up your purchase to the nearest dollar and transfer the change into your savings account.

Chime High Yield Savings. Chime’s free savings account has a 0.50% APY as long as you have a balance of at least $0.01. Chime also has two automatic savings programs: a roundup program for purchases made with a checking account debit card and a program that saves 10% of direct deposits of $500 or more from your checking account into your savings account.

Varo and Chime are online-only, which means you’re out of luck if you prefer in-person service. However, Varo has extended weekday and weekend phone support hours and ways to contact customer support via email and Twitter, and Chime is available through chat, email and phone 24/7 as well as on Twitter.

Varo and Chime also have high mobile app ratings in the Google Play and App Store marketplaces.

Varo. Varo doesn’t let overdrafts happen: If a customer tries to make a transaction that would create a negative balance in their account, then Varo declines the transaction. If you need some breathing room between paychecks, you can use the Varo Advance program, which allows you to get a cash advance of up to $100 for a fee of up to $5.