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Comparing Internet Checking Accounts at Ally Bank and ING Direct

POSTED ON BY

Update 6/15/2012: Please refer to this post for a new comparison of these two checking accounts.

ING Direct and Ally Bank are both major internet-only banks which offer similar internet checking accounts. I thought it would be interesting to see how these compare. For both banks, the internet checking accounts are relatively new. ING Direct was the first to offer a checking account, the Electric Orange, in late 2006. Ally Bank's Interest Checking Account just launched early this year.

Both Ally Bank and ING Direct offer many of the same services that you would expect from an internet bank. This includes no minimum balance requirements and no monthly maintenance fees. Both provide free online bill pay and a free MasterCard debit card. Both accounts pay interest, but both have rate tiers with low rates for small balances. You would be better off keeping large balances in the bank's savings account. However, if you have a very large balance (over $50K), the ING's Electric Orange actually has a higher interest rate than the Orange Savings Account.

The one feature that both banks lack is a remote deposit capture service which allows you to make a deposit by scanning a check at home. That eliminates the need to mail in the check. Currently, you either have to mail in the check for deposit or deposit the check at your local bank, and then initiate an ACH transfer. I think we'll see more internet banks offering remote deposit in the future. One major internet bank that has started offering it is EverBank (see review).

Below is a brief comparison of some of the important checking account features. Which checking account feature is most important for you?

Comparing Checking Accounts at Ally Bank and ING Direct

 

Checking Account Feature ING Direct's Electric Orange Checking Ally Bank's Interest Checking
Writing Checks No paper checks allowed. Payments can be made online and sent by mail. Paper checks allowed. Ally standard checks are free.
ATM Fees Free at Allpoint ATMs (network of 35,000 ATMs nationwide). For non-Allpoint ATMs, there's no reimbursement of ATM fees charged by ATM owners. No Fees. Fees charged by other banks are automatically refunded at any ATM worldwide
Maximum number of links to external accounts for ACH transfers 3 20
Accept mailed checks for deposit Yes, but no postage paid evelopes Yes, postage paid envelopes available
Person-to-person payment service Yes. Requires other person's bank account number. No
Overdraft Policy No overdraft fees. Provides an overdraft line of credit. Interest charged on the amount borrowed. NSF fee of $9 per day. Overdraft transfer service provides free automatic transfers from Ally savings account to checking account to cover transactions when you exceed your checking balance.

If your main concern is interest rates, please refer to my short list of the best internet checking accounts. You can also compare rates on checking accounts from both internet banks and brick-and-mortar banks in our checking account rate table. If you don't mind using a debit card, high-yield reward checking accounts pay the best interest rates. Please refer to our table of reward checking accounts.

  Tags: Ally Bank, ING DIRECT, checking account

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Comments
15 comments.
Comment #1 by Shota (anonymous) posted on
Shota
The article above shows us clearly that Ally Bank's checking account is more flexible and thus liquid. ING expects you to use its checking account like a savings account (no more than 3 external transfers). Plus, there are no checks sent to a customer when s/he sets up a checking account with ING. Ally Bank's checking is designed for everyday expenses while you earn interest. 

Shota

www.ranxem.com

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Comment #2 by shota posted on
shota
The article above shows us clearly that Ally Bank's checking account is more flexible and thus liquid. ING expects you to use its checking account like a savings account (no more than 3 external transfers). Plus, there are no checks sent to a customer when s/he sets up a checking account with ING. Ally Bank's checking is designed for everyday expenses while you earn interest. 

Shota

www.ranxem.com

2
Comment #3 by Jeffry Pilcher | TheFinancialBrand.com (anonymous) posted on
Jeffry Pilcher | TheFinancialBrand.com
Remote deposit is an absolute must for e-checking accounts, although requiring hardware like scanners is impractical. iPhone snapshots of checks and/or the honor system are the only way to go.

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Comment #4 by Anonymous posted on
Anonymous
For my ING account, I use the P2P feature to get around the limit of 3 linked external accounts. Of course, this works only because I am sending money to myself (another account) and therefore have the account numbers. And it can't be used for pulling funds out of the other account. Regardless, I love this feature: fast and easy to use.

Paper checks are going the way of the dodo bird. It's rare that I get a paper check that I need to deposit. So that has not been an issue for me.

3
Comment #5 by rprather (anonymous) posted on
rprather
I've been using Ally as my primary bank for about 4 months now.  And I had used ING in the past.  Frankly Ally Bank is a superior product at least for the reasons listed above.  I use the BillPay (which is good -- Note: for payments by mail you should absolutely schedule payments at least 4 days early; for electronic payments they generally clear/post in 24-48 hrs), the free paper checks, ATM fee refunds...  I use the automatic transfer for overdrafts as a way to earn more interest (Basically, I hold most of my "checking account" money in an Overdraft savings account and let the money move automatically as needed  -- up to 6 times per statement period!).  I've had no trouble with NSF fees as I am not meticulous about know what's coming out of my account and how much is in it. 

Ally's account is more liquid too because ACH transfers in and out are pretty fast -- about 1 or 2 days.

If Ally added remote deposit I would be ecstatic.  This is pretty much the last feature I'm waiting for.  Good comparrison! 

7
Comment #6 by 51hh posted on
51hh
I use Ally as a hub (i.e., transferring funds between RCA banks) and for meeting RCA ACH requirements.  Thus the number of allowable ACH links are crucial. Ally used to allow "infinite" number of ACH links.  In my "legacy" Ally, I have about 50 linked ACH accounts:D 

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Comment #7 by Anonymous posted on
Anonymous
Ally doesn't delete existing ACH links but if you're over 20 they might not allow you to add a new link.

3
Comment #8 by 51hh posted on
51hh
Anon. #7:

Agree, I cannot add or replace more new ACH links with my existing account.  But there are creative workarounds...:-)

1
Comment #9 by Anonymous posted on
Anonymous
With ING you can mail paper checks to anyone for free... I've sent paper checks to myself...

1
Comment #10 by onlinebankers.co.uk (anonymous) posted on
onlinebankers.co.uk
Thanks for the comparison!

3
Comment #11 by Anonymous posted on
Anonymous
The worst thing about ING is the compliance dept, they are nasty, mean and will make negative reports against your check system report if they dont like you.  I have had many accounts and I have never seen such a nasty bank as ING I do many bank bonus deals but I would recommend staying away from ING, no matter if they give away 1K.  I would never get myself in the situation of actually relying upon them to pay my mortgage that is for sure.

2
Comment #12 by Anonymous 3 (anonymous) posted on
Anonymous 3
Ally updated their deposit agreement on 10/16/10 which includes eCheck Deposit Service, their version of remote check deposit.

3
Comment #13 by FLA (anonymous) posted on
FLA
Use Ally Bill Pay for mailed (paper) checks at your peril.  I hve had nothing but problem-problem-problem and they take 7-11 days EACH TIME to even research the issues and often the answer is itself incorrect. 

I have never seen such as ****ed up amateurish operation---because its contracted out, they (Ally Reps) havce NO direct access.  And just TRY to get to talk to a real manager.....

I do not think the product is merchantable or fit for its intended use.

I am in the process of unraveling all my direct deposits BACK to a different bank....that in itself takes almoswt 60 days---and then its good freakin riddance ALLY. 

Ally was the all time WORST financial decision I have ever made.

1
Comment #15 by rjm (anonymous) posted on
rjm
I just recently started using ING as my primary checking account. They use checkfree for billpay which is what Im used to. Plus , I have 100 k in it anyway so its a better rate than Ally.

My first online bank was PCBanker, years later I switched to presidential for my primary checking and a month ago, I attempted to go back to PCB but was rejected, apparently because I opened a lot of accounts and my checksystem shows it. (No problems, just lots of inquires)

So, I had to choose between ING & my 2 reward checking accounts and ING won out.

Have an account at Ally too but not a checking account so no reason to keep $15k in it for a lower rate than ings 1.15%.

My ally money market has paper checks for the few times a year that I need one.

Only difference seems to be ING takes an extra day to process a billpay. I think they keep the float whereas my other banks did not.

Ive got to post the payment for the business day PRIOR to the due date where at the others, I posted ON the due date and every payment was ontime.

 

2