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Five Things You Should Know About the Varo Credit Card
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Five Things to Know About Varo Credit Card Varo Credit Card
It encourages responsible credit use and also keeps the penalties light should you make a mistake up -- which with this card is very difficult to do.
By Jae Bratton Lead Writer Credit card Jae Bratton writes for the credit cards team at NerdWallet. She earned a bachelor's in English from Wake Forest University and a master's in English from the University of North Carolina at Greensboro. Before writing for NerdWallet, Jae spent 13 years teaching English and journalism. Her writing has appeared in blogs, newspapers as well as an academic publication. Jae is from North Carolina.
Updated Feb 10, 2023, 10:19 AM PST
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A LOT LIKE THIS
The Varo Believe Secured Credit Card, issued by the online bank Varo has many similarities with other cards intended for consumers who want to build or rebuild their credit. Its closest relative may be the . It's a similar card that is also targeted at people who are new to the field and newcomers Varo credit card does not offer an annual percent rate or APR; features no annual fee or minimum security deposit, and does not conduct an invasive credit screening when you apply. Those features can save you money as well as keep you from losing points from your credit score, which often occurs following the application process has been completed .
The Varo Believe Secured Credit Card is designed to ward off excessive spending and late or missed payments. It's also capable of earning rewards. However, the safeguards included in the card might seem a bit restrictive or even a little overbearing to some.
There are 5 things to be aware of about the Varo credit card.
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1. You'll need a Varo bank account to get the Varo credit card
There's no cost to set up an account with a Varo bank account, but there's still a hoops you have to leap through. And while there's also no security deposit needed to be used for this Varo credit card, you're only eligible to be approved when you have a Varo account has been able to receive direct deposits of at least $500 within the past 90 days. Deposits from an employer or from the government count, but transfers made through peer-to-peer apps such as Venmo don't.
If the Varo bank account meets these requirements, you'll get invited to submit an application for Varo Believe Secured Credit Card within the Varo Bank app.
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2. You set your own credit limit up to a certain amount
To make use of the Varo Believe Secured Credit Card, you'll have to transfer money out of the Varo bank account to your Varo Believe secured account, which is only possible in using the Varo app. The balance in the account that's secured becomes the credit limit.
However, unlike a conventional credit card one, this Varo credit card comes with spending caps. You'll be restricted to $2500 per day for purchases, and $1,000 per month for cash advances, and the sum of cash advances and purchases can't exceed $10,000 per billing cycle.
A major purchase, such as new furniture, could cause you to go over your spending limit and would require you to find a different payment method if you needed to purchase something else on this day.
3. Credit card transactions are virtually impossible to falsify.
The balance of the Varo Believe secured account is your credit limit, but it also serves as a source of funding for credit card transactions. To ensure you'll have enough cash to cover your monthly bills in total, Varo automatically deducts the amount of any credit card transactions from the remaining balance in the account secured. It's therefore impossible to go overboard with your Varo credit card. Varo also blocks your card if you miss the payment, and they won't allow access until the entire balance is paid off.
To ensure prompt payment, Varo offers a "SafePay" option. With SafePay disabled, the balances will be instantly paid in full by the conclusion of each billing cycle.
The Varo credit card provides information to the three main U.S. credit bureaus. Therefore, these procedures will definitely benefit cardholders who are building or fixing credit histories because they incentivize paying off the balance on their credit card, and . However, such hand-holding is not typically available on traditional credit cards that are unsecured. If and when you change from Varo Believe Secured Credit Card to a standard credit card, be aware that you'll probably need to be more mindful regarding paying your monthly statements. (The secured card offers the only card Varo offers, which means there's no upgrade option within the portfolio.)
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4. The APR is 0%.
Even if you miss an installment on your credit card the balance won't grow due to interest because the APR on this Varo Believe Secured Credit Card is zero percent. That's an incredibly rare, potential savings perk, and is one of the benefits that this credit card offers.
It's just not the way traditional credit cards operate. If you're looking to make an upgrade from your Varo credit card be sure you know your new card's APR.
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5. Cash back is available on select purchases
Varo Believe Secured Credit Card Varo Believe Secured Credit Card offers cash back in two different ways such as offer on the internet and cards linked offers. The online deals offered by Varo -- akin to those offered by a traditional credit card give cash back on purchases made at stores that you've accessed through the Varo application or via a promotional email from Varo.
Or you could use a card-linked offer for cash-back, which works like coupons. Offers linked to cards require activation first, and the purchase must be made with your Varo credit card to be eligible to receive the discounted.
Cash back is deposited automatically to the Varo bank account once you've earned more than $5. Cash-back earning with Varo Believe Credit Card Varo Believe Credit Card are limited to $50 per month. In contrast, other credit cards with secured features offer unlimited cash back , and typically don't require that you browse through a particular portal or sign up for individual offers.
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Card art by Varo. Varo.
Chime Credit Builder Visa(r) Chime Credit Builder Visa(r) Credit Card is issued by Stride Bank, N.A., Member FDIC, pursuant to the license of Visa U.S.A. Inc. and may be used everywhere Visa credit cards can be used.
About the writer: Jae Bratton is a writer for the credit card group at NerdWallet. Her writing has been published in various blogs, newspapers and an academic journal.
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