Varo Bank, which claims to be the first all-digital nationally chartered bank in the US, has raised $510m in an oversubscribed funding round.
Lone Pine Capital acted as the lead investor, with commitments also coming from first-time Varo backers Declaration Partners, Eldridge, Marshall Wace, Berkshire Partners / Stockbridge, and funds and accounts managed by BlackRock.
Some of the other investors to the round include Warburg Pincus, The Rise Fund, Gallatin Point Capital, and HarbourVest Partners.
This capital injection will help the company continue its customer growth and release new products.
Over the past 13 months, the FinTech company has obtained a bank charter, doubled its opened accounts to four million and tripled its revenue. The digital bank also expanded its services to include short-term loan service Varo Advance and cashback rewards with Varo Perks.
The company is also scheduled to launch Varo Believe, a credit building credit card program.
Varo Bank CEO and founder Colin Walsh said, “The time is now to bring the best of fintech to the regulated financial system and build an entirely new kind of bank: one where consumers no longer have to choose between a sophisticated digital experience and a trustworthy banking partner.
“This funding accelerates our path to achieving a profitable, transformative, and sustainable business designed to advance financial inclusion for millions of consumers.”
Launched in 2017 Varo offers premium bank accounts with no minimum balance requirements, monthly account or overdraft fees.
Financial Technology Partners LP and FTP Securities served as the financial and strategic advisors to Varo Bank.
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