SAN FRANCISCO—All-mobile banking services startup Varo Money has received the FDIC’s approval of its federal deposit insurance application for Varo Bank.
The FDIC’s approval positions Varo to become the first fintech to obtain a full-service, FDIC-insured national bank charter, JD Supra reported.
On Sept. 4, 2018, the bank announced it received the OCC’s preliminary conditional approval of its application for a full-service national bank charter. The OCC conditioned its final approval, in part, on the Bank receiving federal deposit insurance.
In order to issue its final approval of the bank’s charter application, the OCC will hold a final pre-opening examination of the bank to evaluate whether it has satisfied the financial requirements outlined in the OCC’s preliminary conditional approval. The Federal Reserve also will have to approve Varo’s application to form a parent bank holding company and any other conditions to the agencies’ approvals will have to be satisfied, JD Supra said.
“The FDIC’s approval of Varo’s application for federal deposit insurance is significant not just because it is the first of its kind. The approval also establishes a path forward for other fintechs seeking to pursue a full-service, FDIC-insured bank charter – whether nationally or state-chartered. Varo, like other fintechs, currently offers depositors online banking services in partnership with an established bank. Obtaining a national bank charter will allow Varo to operate independently,” JD Supra said.