Varo Bank, the first native digital bank in the US, says it has increased its Cash Advance amount for certain customers – double the previous amount available of $250. Varo Bank says the Cash Advance offering is “one of the lowest-cost short-term loans available among finance apps.”
On the bank’s website, the small print provides additional information on the service:
Colin Walsh, CEO and founder of Varo Bank, said they increased the limit because some of their customers are living paycheck-to-paycheck and have asked for a way to pay for increased living costs without going into debt.
“Varo Advance allows customers to cover their short term cash flow gaps at a low cost with the flexibility to pay it back over 30 days, which we hope will be particularly helpful at holiday time.”
Varo says that their research indicates that inflation has driven the cost of living higher, and the job market has cooled in many parts the country. The bank notes that women can be more impacted by the hardships of living paycheck-to-paycheck, with 67% identifying as financially fragile and not feeling able to find $2,000 in 30 days if needed.
Additionally, 52% of people who identify as living paycheck-paycheck have less than a College-level education, yet 48% have at least a College diploma or higher, proving that post-graduate education doesn’t guarantee financial security.