I’ve always thought that ING Direct Canada’s business approach is smart, from its branding to its overall marketing to how it treats its customers. Over the years, it has projected a rather straightforward message about no hidden fees and good rates. This is complemented by an uncluttered website and a smart referral program. (In general, a referral program is usually a good idea, as it encourages people to recommend your product or company without having to pay them as employees. And, of course, you are not only getting new, high-quality customers — not just iffy leads — but you also take no risk until you’ve actually signed up a customer.)

ING Direct wasn’t the pioneer of high interest savings in Canada, but many people might think that it was. And even though the majority of other Canadian banks and credit unions have created high interest savings accounts (some which have higher interest rates), ING Direct remains a strong player. So it has been doing something right all along. Of course, the savings account isn’t the only “product” that ING Direct offers, but that account is a very important entry point for people to do other, more lucrative business with ING Direct, with mutual funds, mortgages, business accounts, and more.

Out of the blue, I recently got a package in the mail from ING Direct consisting of:

- The 272-page book The Orange Code: How ING Direct succeeded by being a rebel with a cause.

- A letter explaining their expanded referral program (both the referrer and the referree still get $13; however, they raised the limit from 20 referrals to 50 referrals, and extra monetary bonuses after you’ve referred 10, 20, 30, 40, and 50 friends:

– This letter also notified me that ING Direct had made a deposit to my account for back-dated referral money from before the referral program was changed. (I was lucky to refer over 20 people a couple of years ago from this post.)

Why is this smart?

By sending the package in the first place, they are showing some customers that they care.

With the free book, they are enticing customers to learn more about them. Presumably, this will spur readers to talk about the book and the story behind ING Direct. (Note: I haven’t read the book yet.)

The revamped referral program structure is designed to get influencers to work cheaply for ING Direct. When I say “influencers” I mean consumers that other consumers listen to, providing free, effective, word of mouth advertising, provided that the influencers actually like your company. If you have the capability to refer up to 50 people, you are probably well connected or have an opinion or channel that people respect. ING clearly wants those people on their side!

By back-dating the benefits of a program, you help to keep your existing customers and once again get them to recommend you to others. So many times in the forums, I’ve noticed people complain about how a bank’s new promotion doesn’t apply to existing customers. In other words, those banks usually project an attitude of only caring about sucking people in, but not in treating them well once they’re customers.

I have a friend who received a similar package from ING Direct at the same time as me. Her reaction was: “I couldn’t believe they gave me $50. I love them!” I’m not quite as enthusiastic, but ING Direct certainly succeeded in many respects here.

Forum/Topic		Started	Last Post	Posts
	ING Direct ING Direct Canada launches free chequing account 1 2	August 18, 2010 12:28 am by Peter	September 3, 2010 2:04 pm by Guest2	31
	ING Direct Investment Savings Account up	August 5, 2010 1:00 am by Jay	August 6, 2010 1:17 pm by kilarney	5
	ING Direct TFSA down to 2%	April 28, 2010 1:48 am by Nightowl	July 24, 2010 7:26 pm by Guest2	16
	ING Direct ISA and GIC rates raised	July 2, 2010 10:08 pm by Nightowl	July 13, 2010 9:13 pm by Guest2	10
	ING Direct Help!…… ING direct is holding rsp’s from my mom after my fathers death. 1 2	May 10, 2010 2:43 pm by Rick	June 17, 2010 4:56 pm by kilarney	28

ICICI Bank in Canada is a CDIC-insured online bank in the Canadian high-interest savings account market. It has six branches in Canada. Most relevant for me are the branches in Surrey and Vancouver.

ICICI seems like a rather mysterious bank, and a quick search on RedFlagDeals.com yields some mixed reviews about its customer service (but as I’ll discuss shortly, ICICI isn’t after the “service and features” niche in the high interest savings account market). It certainly doesn’t give me the same warm fuzzy feeling as the account I have with ING Direct. But hey, I’ll be a guinea pig and sign up with ICICI and document the entire experience.

Why I considered ICICI

Quite simply, its HiSAVE account currently (July 2007) has the highest rate at 4.5%. HSBC Direct is offering a 5.0% promotional rate, but that only lasts until October, and then the rate reverts back to a “regular rate” (which was 3.5% before the promotion started). The other banks hover around 3.5% to 4.1%. To be honest, the 0.4% doesn’t make that big of a difference if you already have another account at 4.1%; however, if you’re looking to open a new account, why not go for the one with the highest rate?

ING Direct vs ICICI

I lump ING Direct and ICICI Bank in the same category. I consider this to be the “dump money like a term deposit and then transfer money back to another bank when you need it” category.

With other banks such as Citizens Bank and PC Financial (see my reviews on CB and PCF for full details), you can do things like pay bills online, and pair a high-interest savings account with a more chequing-like account to get free cheques, Interac capability and more. Therefore, the other banks are well-suited for almost completely replacing the need for a traditional bricks and mortar bank. With ING Direct and ICICI, this is not possible (ICICI does have a chequing account, but the fees prevent it from being comparable to the other banks), and you are very dependent on having an account with a more fully-featured bank in order to do anything with your money.

At both ING and ICICI, you can withdraw money for free from their (very few) ABMs. However, I work very close to the ING Direct branch in Vancouver and have never used its ABM, simply because I use my Citizens Bank account for my regular transactions.

With the ING Direct Investment Savings account’s rate a full 1.0% below that of ICICI’s HiSAVE account, ICICI is certainly worth a look for me.

ING Direct does have two feature advantages over ICICI:

• ING Direct will pay any service fees for ABM money withdrawal at other machines, up to 4 times per month
  -Again, because my Citizens Bank account has all the features I need, I never use my ING Direct card. Whenever I need money from ING Direct, I simply withdraw it electronically to a linked account at another bank.
   
• ING Direct sends a fun quarterly newsletter with facts about its products and the odd cultural fact about the Netherlands.
  Overall, ING Direct is a lot better at marketing. But perhaps they cannot offer a better rate because they invest so heavily in PR.

The application

ICICI Bank currently has a referral promotion where if you are referred by someone and open an account with an initial deposit of $100 or more, both you and the person who referred you will get $20. I quickly sourced a referral on the RedFlagDeals.com forums and received a referral e-mail in my inbox a few minutes later.

I have now filled out the online application form on the night of Sunday, July 22nd, 2007. It asked me for basic information such as contact info and Social Insurance Number. One thing I noticed is that the sign-up form was not encrypted (no https:).

To activate my account, the instructions state:

“Simply send us an initial deposit for your new account in the form of a personal cheque, with your name pre-printed, from any Canadian Financial Institution. Make the cheque payable to yourself in the amount of your initial deposit. Please write the ICICI Bank Canada Temporary Reference number in the memo field of your deposit cheque.”

“Your new ICICI Bank Canada HiSAVE Savings Account will be activated once your cheque towards initial deposit is cleared. You will receive a welcome letter in the mail which will contain your 10-digit Internet banking user ID and in a separate mailing you will receive you internet banking password.”

I will mail the cheque tomorrow morning.

Part 1 | Part 2 | Part 3 | Part 4 | Part 5

Latest posts in the ICICI Bank forum

Forum/Topic		Started	Last Post	Posts
	ICICI Bank please send me ICICI promo code 1 2 3 4 5	November 23, 2008 2:07 am by Tim	August 22, 2010 4:07 pm by INDIAN	89
	ICICI Bank Where is the icici bank user id in Welcome kit – Please answer	August 21, 2010 6:22 pm by Sumeet	August 21, 2010 6:22 pm by Sumeet	1
	ICICI Bank ICICI savings up to 1.6%	August 19, 2010 3:36 am by Weatherguy	August 19, 2010 8:25 pm by mike	3
	ICICI Bank Can you please send me the PROMO code for ICICI bank NRI a/c…….Thanks	June 22, 2010 11:23 am by Rinku	June 22, 2010 11:23 am by Rinku	1
	ICICI Bank Ref	May 16, 2010 6:49 pm by Jesus	May 30, 2010 9:35 am by Voodoo guest	2

Website: http://www.ingdirect.ca
Account of note: Investment Savings Account, 3.65% as of January 27th, 2008

Catchy ads and fun newsletters call attention to what is actually a rather limited account. You must rely on linking this account to another bank (once you do this, you can transfer money between banks for free), as there are only 7 ATMs in Canada where you won’t be charged fees to withdraw money directly from ING Direct. This might actually encourage you to save your money…

What ING Direct has going for it is the simplest online interface I have ever seen. Online banking beginners will enjoy the flat learning curve:

Key Details
-no minimum balance required
-no cheques available, no online bill payment system
-very accessible customer service by phone

Interesting Facts:
-Get a $13 sign-up bonus by registering at http://www.ingdirect.ca/en/ISAfriends/ before the end of the 2008. I’d post mine publicly, but that might defeat the unbiased approach I’m going for…
-You can choose to stop receiving paper statements from ING Direct (to be environmentally friendly).

Bottom line:
I have accounts at Citizens Bank, ING Direct, and PC Financial and here’s my conclusion:

Use ING Direct for the easy-to-use interface.
Use Citizens Bank for the most powerful, flexible account with the best feature-to-rate ratio.
Use PC Financial for the highest rate if you have more than $1,000.

Latest posts in the ING Direct forum

Forum/Topic		Started	Last Post	Posts
	ING Direct ING Direct Canada launches free chequing account 1 2	August 18, 2010 12:28 am by Peter	September 3, 2010 2:04 pm by Guest2	31
	ING Direct Investment Savings Account up	August 5, 2010 1:00 am by Jay	August 6, 2010 1:17 pm by kilarney	5
	ING Direct TFSA down to 2%	April 28, 2010 1:48 am by Nightowl	July 24, 2010 7:26 pm by Guest2	16
	ING Direct ISA and GIC rates raised	July 2, 2010 10:08 pm by Nightowl	July 13, 2010 9:13 pm by Guest2	10
	ING Direct Help!…… ING direct is holding rsp’s from my mom after my fathers death. 1 2	May 10, 2010 2:43 pm by Rick	June 17, 2010 4:56 pm by kilarney	28