Marqeta Becomes Exclusive Issuer Processor for Varo Bank

Varo Bank has selected Marqeta as its issuer processor on a five-year deal to help achieve its mission of bringing financial inclusion to customers and the communities it serves. 

Varo is the first nationally-chartered consumer tech bank in the US. Its services include fee-free checking accounts, free ATM access, lines of credit and cash advances to customers, as well as instant payment solutions and high-yield savings accounts.

With over 5 million cards on the market today, Varo says it selected Marqeta for its ability to combine virtual, tokenised and physical card-issuing technology with faster speed-to-market. 

Varo: Choosing a complementary issuer partner

Speaking on the new partnership, Varo Bank CEO Colin Walsh says: “We sought an issuer partner that complements our unique position as both a technology company and a regulated financial institution.

“This partnership with Marqeta enables us to offer cutting-edge card issuing technology, giving our customers enhanced ability to view and manage their transactions efficiently. This advancement aligns perfectly with our mission of financial empowerment.”

As for Marqeta, its decision to support Varo comes after its 2024 State of Payments report found that a majority of consumers had or were seeking ways to switch from their primary bank account to a digital-only or non-traditional financial institution. 

51% of consumers surveyed by Marqeta were cited as saying they had already changed their primary bank, with an additional 18% considering the change to digital-first banking. 

What’s more, 20% of US consumers reported favour for a better mobile banking experience when looking to switch primary accounts. 

Consumers want a digital banking experience, and Marqeta is supporting the growth of modern banking in the US by supporting the likes of Varo. 

Simon Khalaf, CEO of Marqeta, says: “Marqeta is proud to announce this deal with Varo Bank, which relies on the latest payments and banking technologies to help Americans who are striving to get ahead. 

“Varo's mission is aligned with ours and we can't wait to start innovating with the Varo team, enabling their customers to see transactions in real-time thanks to Marqeta's APIs."

With Marqeta’s platform, Varo will also enable digital wallet tokenisation with Apple and Google Wallets for its cardholders. It is the first bank to receive a de novo national bank charter as a consumer tech bank in the US.

The rise of Varo

With 5 million cards on the market, Varo’s rise has been considerable since its 2015 founding by former Wells Fargo executive Colin Walsh and a national bank charter grant in 2020.

It has raised over US$992.4m to date, with investment coming from leading institutional investors such as Warburg Pincus, The Rise Fund, Gallatin Point Capital, Harbourvest Partners, Progressive Insurance, Russell Westbrook Enterprises and Lone Pine Capital.

Varo’s working model combines the experience of banking veterans with up-and-coming technology experts to offer consumers the best mobile banking app experience with the financial nous of veteran financiers to guide them in making the right financial decisions. 

Varo recently celebrated four years of being a nationally-chartered bank. 

**************

Make sure you check out the latest edition of FinTech Magazine and also sign up to our global conference series – FinTech LIVE 2024. 

**************

FinTech Magazine is a BizClik brand.