As the finance sector is majorly developing itself into an online system to ensure more productivity and security among the users for their betterment. There have been a lot of fraud complaints against different persons and organizations due to the non-arranged system of banking, which leads to unsafe money of the users. Though there have been various developments, the most important one would be to make people aware of the usage of these platforms, which is done through the self-learning brochures attached to the apps, which guide them throughout their functioning. A few of such systems will be discussed in this article, which has an online feature along with multiple additional benefits to make people earn more profits.
Chime Bank vs Varo
Varo Bank was founded in 2015. It is an online bank. It is one of the most sought-after options for online-only banking. On the other hand, Chime is a technology company and not a bank. The services are provided in Chime by The Bancorp Bank and Stride Bank, N.A., Members FDIC.
What Is Varo?
Varo Money was founded by Assaf Guery, Colin Walsh, Mykola Klymenko, and Roger Van Duinen, in 2015. The company offers no-cost premium bank accounts, and their savings accounts have high interest rates.
Varo offers a bank account without any monthly charges or any minimum balance. They maintain their network without any presence of physical location. In spite of this, customers can access their account and money through a wide network of more than 55,000 fee-free Allpoint ATMs around the world.
Varo is a mobile banking app that helps you to manage your money by providing various types of budgeting tools, goal setting activities and account monitoring. It has a distinct feature by the name of "Vault" Vault is a special account that helps you to save money for few particular or specific goals.
There are no account charges and no conditions of minimum balance or monthly fees. Without any physical location, just with the help of ATMs, you can access your money whenever you want. Varo will not allow you to spend more than you have in your account so, this helps you avoid any overdraft fees.
What Is Chime Bank?
Chime, headquartered in San Francisco, was founded by Chris Britt and Ryan King in 2013. The official launch was on April 15, 2014, on the Dr Phil Show.
They have an application for the customers to know about their finances. Any type of query can also be cleared with the help of operators.
Originally, Chime is a financial technology company. They make profit with their customers and not from them. And that is the reason they do not have any monthly service fees, overdraft fees, service fees, minimum balance requirements, and more.
Their working mechanism is a bit different. They have partnered with regional banks to deliver financial products with lower cost.
Since Chime has a banking app, it helps you categorize your spends, where you are spending more, helps you to budget your goals and lets you know if you are meeting them well. Also, Chime offers a a higher interest rate than most traditional savings accounts. The account has no monthly fees and requires no minimum balance.
Main Difference Between Chime Bank And Varo in Points
Let’s look into a face-off between the two to simplify the same and make it easy for the users to choose one for which we will be going through the ratings provided by a finance organization known as BBB, Better Business Bureau
- The BBB gave Chime an F rating. The BBB states that Chime has received this rating because of customer complaints. Chime doesn't respond to such complaints or takes a long time to do so. On the other hand, Varo has A rating.
- Chime used the URL "Chimebank.com" and the words, "bank" and "banking", in spite of not being allowed to operate as a bank. That is why, there was government action against Chime.
- Their approach to Savings is different. Varo follows a "Save Your Pay" rule, which suggests customers to keep aside a certain amount of their salary for savings. Chime offers a static 10% savings on the “Save When You Get Paid” plan.
- Chime offers a 1.5% interest rate on balances up to $50,000, whereas Varo offers 0.5% to 5% APY.
- Varo seems to be a better option for people who are planning to multiply their savings.
- Varo Bank has a Free checking account with no minimum balance requirement, whereas Chime Bank has a Free checking account with no minimum balance requirement.
- Varo bank has a savings feature to transfer funds from a Varo checking account or an external ACH transfer to a savings account, whereas Chime bank has as - You can only transfer money to a savings account from a Chime checking account – external transfers aren’t allowed.
- Varo Bank Offers mobile and online banking access to manage accounts and deposit checks, whereas Chime Bank offers mobile and online banking access to manage accounts and deposit checks.
Both banks have their own pros and cons, which makes them different from each other, but in the end, it depends upon the users as to what they choose as a better option.