VARCHAR can store up to 2000 bytes of characters while VARCHAR2 can store up to 4000 bytes of characters.
If we declare datatype as VARCHAR then it will occupy space for NULL values. In the case of VARCHAR2 datatype, it will not occupy any space for NULL values. e.g.,
name varchar(10)
will reserve 6 bytes of memory even if the name is 'Ravi__', whereas
name varchar2(10)
will reserve space according to the length of the input string. e.g., 4 bytes of memory for 'Ravi__'.
Here, _ represents NULL.
NOTE: varchar will reserve space for null values and varchar2 will not reserve any space for null values.