ING Direct: no fees and 2.6% APR, but with caveats

ING Direct: no fees and 2.6% APR, but with caveats

ING Direct has built a fruta as a fee-free online bank with attractive interest rates. But the reality, based on years of accumulated experience, is more nuanced. The Orange Account, which once paid new customers 2.6% APR, has seen that rate plummet to 1.2% for existing ones. The payroll account, meanwhile, offers free cards and a 2% rebate on direct debits, but only for those who signed up before 2013. Phone support, however, gets top marks. Is it worth it? It depends on what you're looking for.

What does ING Direct actually offer?

ING Direct's offering revolves around two main products: the Orange Account and the payroll account. The former works as a savings account linked to another bank, with no fees or minimum deposit, and monthly interest payments. The latter requires having your salary paid in or making a regular transfer, and in return gives you a free debit card with free cash withdrawals at 4B and Euro 6000 ATMs (the latter from 50 euros).

The Orange Account's historical appeal was its return. For years it offered a 2.6% APR for new customers, although that rate dropped to 1.2% for existing ones. That gap has spawned a market of "tricks" to pose as a new customer and keep earning the higher rate, something that has become a national sport among the most meticulous savers.

The payroll account, for its part, adds a 2% rebate on direct debits (electricity, phone), an incentive ING kept for pre-2013 customers but scrapped for new ones. In other words, if you arrived late, that 2% no longer exists for you. The credit card, which is free, can be requested after 3-4 months with recurring income.

What are ING Direct's drawbacks?

The main weakness cited is the website. Customers repeatedly describe it as "shoddy, sloppy and full of bugs". While basic operations work, managing deposits and changing personal details (like the profile picture) have caused problems. In addition, the bank is not Spanish but Dutch, and deposits are guaranteed by the Dutch deposit guarantee scheme rather than the Spanish one, a detail some see as an advantage and others as a risk.

Another recurring complaint is the inability to add joint account holders when opening the account online. The form doesn't allow it; you have to do it afterwards, in the documentation area. This has caused confusion and more than a bit of frustration.

On the deposit side, ING has been cutting back. Where it once required 25,000 or 50,000 euros for certain fixed-term deposits, the minimum is now 10,000 euros and it only offers two products, with returns of 1.50% and 1.75%. What's more, you can't add extra capital until the deposit matures, which limits its flexibility.

Is the customer service worth it?

Here ING takes the crown. Phone support is fast, they sort things out without rushing, and they don't hang up until the problem is solved. It's the only bank to score a 10 in this respect according to accumulated experience. Traditional banking, by contrast, fails: branches where they lie to you, convoluted procedures and access codes that get cancelled every so often.

For many, that quality of service is the main reason to stay. It's not all about interest rates.

What alternatives are there to ING Direct?

The landscape doesn't end with ING. Some point out that Bankinter pays interest on the account instead of rebating bills, and other institutions offer similar discounts. The Coinc account also comes up as an option with competitive returns. The conclusion is that, although ING remains a benchmark, it's no longer the only one.

ING's trajectory points to a pogre loss of advantages for new customers. Interest rates have fallen, deposits have become more demanding, and the bill rebate is history for newcomers. If this drift continues, its competitive edge will likely shrink to customer service and the absence of fees. We'll see if that's enough.