Marqeta Becomes Issuer-Processor for Varo Bank

Card issuing platform Marqeta has been named issuer-processor for online bank Varo.

“Varo selected Marqeta for its ability to combine sophisticated virtual, tokenized and physical card-issuing technology with faster speed-to-market which will help its customers improve their daily relationship with money,” the companies said in a news release Tuesday (Aug. 6).

The release notes that Marqeta’s platform allows Varo Bank to enable digital wallet tokenization with Apple and Google Wallets for its cardholders. It also points to a Marqeta report — backed by PYMNTS Intelligence research — showing consumer interest in digital-only banking.

“We sought an issuer partner that complements our unique position as both a technology company and a regulated financial institution,” said Varo Bank CEO Colin Walsh.

“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.”

PYMNTS spoke earlier this year with Sachin Shetty, chief technology officer at Varo Bank, about the concept of composable banking, which is built around microservices and cloud-native architecture “instead of monolithic mainframes” to deliver financial services.

“Gen 3 systems, built as microservices, allow us to choose the parts of the core that give us the highest leverage in our build-versus-buy decisions,” Shetty said. “We can leave the commonality of what the core does and focus on building unique experiences for our customers.”

As that report notes, Varo Bank’s composable approach has helped to launch products like Varo Advance, a short-term loan program, and the Varo Line of Credit, designed to help customers manage unexpected expenses.

“These products, developed leveraging composable architecture, provide quick, hassle-free access to funds, illustrating the agility and customer-centricity that modern core systems afford,” PYMNTS wrote.

Marqeta’s partnership with Varo comes weeks after the company teamed with Visa and Affirm as it became the first U.S. processor to enable Visa Flexible Credential, a card offering that toggles between payment methods: debit, credit, cryptocurrency and pay-over-time options.

“Marqeta achieved certification with Visa Flexible Credential in May 2024, which will enable cardholders of Marqeta’s participating customers to easily set parameters or choose whether they use debit, credit, “pay-in-four” with Buy Now, Pay Later or even pay using rewards points,” the company said in a news release.

By offering consumers more payment choices, the company said, Marqeta customers can “improve the consumer purchase experience and increase merchant acceptance.”