In May 2023, Varo Bank, the only tech bank with a de novo charter, announced the decision to outsource their contact center and a portion of the remote deposit capture group, impacting 97 roles. This move aims to reduce costs and bring the company closer to profitability. In this article, we'll discuss the reasons behind the layoffs, their potential impact on the company, and what the future may hold for Varo Bank.
The layoffs at Varo Bank were primarily driven by the need to reduce costs and bring the company closer to profitability. The CEO of Varo Bank, the decision to fully outsource their contact center and a portion of the remote deposit capture group was made to streamline operations. This move, along with other changes to optimize the company's structure, impacted 97 roles within the organization. To support the affected employees, Varo Bank provided transition assistance and career resources for new opportunities.
The decision to outsource Varo's contact center and a portion of the remote deposit capture group is expected to strengthen the company's financial position, preserve capital, and improve its cost structure. As a result, revenue is anticipated to increase throughout 2023, with customer engagement and product-led growth initiatives driving this acceleration.
Varo Bank's decision to lay off employees and outsource its contact center and a portion of the remote deposit capture group may signal a shift in the finance industry towards increased cost efficiency and streamlined operations. As the only tech bank with a de novo charter, Varo's actions could influence other financial institutions to reevaluate their operational structures and consider similar measures to remain competitive. The industry may see a trend towards outsourcing and automation, as companies strive to reduce costs and improve profitability while maintaining high-quality services for customers.
Varo Bank's layoffs aimed to reduce costs and streamline operations, impacting 97 roles. Outsourcing the contact center and a portion of the remote deposit capture group is expected to strengthen the company's financial position and drive revenue growth. This move may influence other financial institutions to adopt similar measures for increased cost efficiency. As Varo continues to invest in product innovation and customer growth, the company's future success and industry standing could be significantly impacted.
