Loans That Work With Your Favorite Banking Apps: Varo, Chime, and More

Written by: Timothy Moore, CFEI®

Edited by: Kristen Barrett, MAT

Reviewed by: Kyle Ryan, CFP®, ChFC®

When you need money fast, emergency loans can be the only way forward. But how do personal loans and even payday loans work if you don’t have a traditional bank account, but instead use a mobile bank or digital wallet?

Below, we’ll explore loans that work with your favorite banking apps, including Chime, Varo, Venmo, and Cash App.

Best for Thin CreditFixed APR6.60% – 35.99%App CompatibilityChime, Varo, Netspend, Current BankFunding$1K – $75KMin. Credit Score3004.8View RatesBest for Fair CreditFixed APR7.74% – 35.99%App CompatibilityChime, Varo, Netspend, Current BankFunding$1K – $50KMin. Credit Score5804.6View RatesBest for Military FamiliesFixed APR8.74% – 18.00%App CompatibilityChime, Varo, Netspend, Current BankFunding$250 – $50KMin. Credit ScoreNot disclosed4.6Read ReviewBest Peer-to-Peer LenderFixed APR8.99% – 35.99%App CompatibilityChime, Varo, Netspend, Current BankFunding$2K – $50KMin. Credit Score5604.6View RatesBest for Good CreditFixed APR6.99% – 35.49%*App CompatibilityChime, Varo, Netspend, Current BankFunding$5K – $100KMin. Credit Score6504.5View RatesTerms & DisclosuresBest for Credit Card DebtFixed APR7.95% – 35.99%App CompatibilityChime, Varo, Netspend, Current BankFunding$5K – $40KMin. Credit Score6404.5View RatesBest Secured LoanFixed APR5.99% – 29.91%App CompatibilityChime, Varo, Netspend, Current BankFunding$1K – $50KMin. Credit Score6004.5View RatesBest for Excellent CreditFixed APR7.74% – 24.94%App CompatibilityChime, Varo, Netspend, Current BankFunding$5K – $100KMin. Credit Score6604.4View RatesBest for Joint LoansFixed APR6.53% – 35.99%App CompatibilityChime, Varo, Netspend, Current BankFunding$1K – $40KMin. Credit Score6004.4View RatesBest Credit UnionFixed APR8.99% – 17.99%App CompatibilityChime, Varo, Netspend, Current BankFunding$600 – $50KMin. Credit Score7004.3Read Review

Personal loans that work with Chime, Varo, Netspend, and Current Bank

Most major personal loan lenders require you to connect a checking account to your personal loan portal so you can repay the loan. You’ll often get a slight rate discount (typically 0.25%) for setting up automatic payments.

Though some of the best mobile bank apps may not technically be banks (Chime, for instance, is a financial technology company, or fintech, that offers banking services but doesn’t hold a bank charter), they tend to have checking accounts with real account and routing numbers that allow you to set them up for personal loan repayment.

Below, we’ve explored how some of the most popular mobile banking apps pair with our choices for the best personal loans. But remember: You’ll need to meet other eligibility criteria, such as credit score and income, to qualify for personal loans.

• About Chime: Chime is a neobank, meaning it’s not technically a real bank. However, the fintech offers a wide range of banking services, including a checking account, savings account, and credit card. Thus, you can use Chime to repay personal loans from popular lenders such as Upstart and LendingClub.
• About Varo: Unlike Chime, Varo is an online bank that actually holds a bank charter. It’s one of the best and oldest mobile banking apps available. It’s compatible with major personal loan lenders such as Navy Federal Credit Union and SoFi.
• About Netspend: Netspend offers a prepaid card, which you can reload money on as you need to make purchases. Personal loan lenders won’t approve you for a personal loan with a prepaid card. If this is how you do your primary banking, you won’t be able to get a traditional personal loan.
  • However, Netspend also offers a debit account, which comes with a debit card, allows direct deposit, and includes a traditional bank account number and routing number. If you have the actual account, you should be able to take out personal loans from the above lenders, including Prosper and Best Egg.
• About Current: Like Chime, Current is not a bank but offers banking services through a partner bank. You should be able to use Current to repay personal loans through popular lenders such as Upgrade and LightStream.

"If you don’t have a traditional bank account and are considering borrowing money, I would first ask how soon you need the money. You can open a traditional bank account rather quickly these days and have near immediate access to the account if needed. I usually advise every client of mine to have some sort of “traditional” bank account if they don’t already. The world is moving more and more in this direction, so it’s better to get it now than need it again in the future for a different reason. Depending on the type of “bank” account you have, you may still be able to access a loan or a line of credit, so reach out to that company to see whether it’s possible." - Kyle Ryan, CFP®, ChFC®

Do personal loans work with PayPal, Venmo, or Cash App?

If you primarily rely on a peer-to-peer payment app (P2P) to handle your finances, you may run into trouble when taking out a personal loan. After all, these apps are designed primarily to transfer funds between friends and family, and with small businesses, not to make major bill payments.

However, popular P2P payment apps such as Venmo and Cash App have expanded their services in recent years to offer debit cards or checking accounts that could make them compatible with personal loans.

A note on using P2P payment apps as your bank

Accounts with P2P payment apps don’t offer the same protection as insured, regulated bank accounts and may leave you more susceptible to fraud and irreversible charges. Consider opening a bank account instead.

It’s possible to open a bank account even if you have a history of overdrafts or have had a bank close account in the past, though your options may be more limited. Here are some resources to get you started:

• Best Second-Chance Bank Accounts
• Banks and Credit Unions That Don’t Use ChexSystems

Personal loans that work with PayPal

PayPal allows you to get set up with an account number and routing number, as well as a debit card. That might make it possible to repay your personal loans using the digital wallet. Check with each lender you’re considering before applying, but also weigh the benefits of opening a true bank account; money that sits in PayPal is not insured.

Personal loans that work with Venmo

Venmo, which is owned by PayPal, also offers a debit card and now has a routing number. This means you might also be able to use Venmo to repay some personal loans, but you’ll need to check with the lender before applying. Again, reconsider using Venmo for this purpose. 

Personal loans that work with Cash App

Similarly, you can get a routing number and a debit card with Cash App, so you might be able to take out personal loans using the service. Again, reconsider this method; a true bank account is a safer way to store your spending money and your savings.

Payday loans that work with Chime, Varo, Netspend, and Current

We advise against payday loans because they are predatory: They have high fees (equivalent to nearly 400% APR, according to the Consumer Financial Protection Bureau) and encourage a cycle of repeat borrowing.

However, if a payday loan is your only path forward, here’s how they work with your favorite mobile bank apps.

Do payday loans work with PayPal, Venmo, or Cash App?

Payday loan lenders typically require repayment via debit cards, ACH withdrawal, or cash only—in-person, over the phone, or via an online portal. This means you won’t be able to pay via a digital payment app.

However, if you have a debit card or checking account with a P2P payment app such as PayPal, Venmo, or Cash App, you might be able to make your payments that way. Check with the lender before taking out a loan.

Loan alternatives to consider

Personal loans aren’t your only option when you need cash, and payday loans should never be your first choice. Here are some alternatives to consider for each.

"There are many options for borrowing money or getting access to a line of credit depending on your assets, income, and credit score. Certain options (such as HELOCs and personal lines of credit) take time to open and gain access to, whereas a loan can be quick once approved. Without a traditional bank account, it is imperative to ask your current financial institution whether you can use your checking or savings account (or its equivalent) for loans and lines of credit." - Kyle Ryan, CFP®, ChFC®

Personal loan alternatives

While personal loans can be used for almost anything and are helpful in several situations, consider these alternatives if they’re available to you:

• Home equity loans and home equity lines of credit (HELOCS): If you’re a homeowner with enough equity, a home equity loan or HELOC is likely a more affordable way to fund home renovations.

"Home equity products usually offer lower interest rates because they’re collateralized against the value of your home." - Kyle Ryan, CFP®, ChFC®

• 0% interest balance transfer credit card: If you’re consolidating credit card debt, look for cards with 0% APR during an intro period. This may be an interest-free way to repay your debt. Explore more about balance transfer cards vs. personal loans.

"Be aware of the one-time fee for the balance transfer." - Kyle Ryan, CFP®, ChFC®

• Payment plans: If you’re considering a personal loan to pay for large expenses, such as a medical procedure or tax liability, see whether a low- or no-interest payment plan is an option instead.
• Family and friends: If you’re looking for the best small loans, it may not be worth paying origination fees and interest. Instead, ask a loved one to loan you the money if you’re facing a financial emergency, like unexpected car repairs or vet bills. Only go this route if it won’t strain your relationship and you’re sure you can repay them quickly.

"Be wary of gifting rules and “arms-length transaction” rules when gifting or receiving money from friends and family. The IRS wants to see a “reasonable” interest rate for the type of loan you are receiving. A gift is entirely different." - Kyle Ryan, CFP®, ChFC®

Payday loan alternatives

We highly advise against taking out a payday loan, even when it feels like the only path forward. Instead, consider these payday loan alternatives:

Need cash, like, right now? EarnIn lets eligible users access up to $150 from their earned wages with no interest or mandatory fees.¹ First-time users may be eligible for expedited funding at no cost.²

• Cash advance apps: Cash advance apps like Dave and EarnIn allow you to access a portion of your paycheck ahead of payday. Some of these services are totally free, but be careful: They can lead to the same cycle of debt as payday loans. Here are the best cash advance apps to consider.

• Payday alternative loans: Credit union members may have access to payday alternative loans, small, short-term loans that are regulated by the National Credit Union Administration. These are far safer than payday loans.
• Personal loans with same-day funding: If you have the credit score for it, a personal loan is much better than a payday loan. And with many online lenders, you can get approved and funded the same day.
• Family and friends: If a payday loan feels like your only viable option, talk with family and friends before taking out the loan. Someone may be willing to give you the small loan you need. Always make a plan to pay them back ASAP.