Updated on 01.17.08

Weighing the Positives and Negatives of ING Electric Orange Checking

Trent Hamm

I’ve been weighing the positives and negatives of ING’s new Electric Orange checking account, which is now available to some existing ING Direct customers and will be available to everyone in a few months. Rather than repeating what’s already been said, I encourage you to read this fine summary of Electric Orange at The Sun’s Financial Diary.

The Positives

The Interest
For any balance, Electric Orange offers a 3.00% APY interest rate. This means while money is sitting in your checking account waiting to be withdrawn to cover bills, you can earn 3.00% percent on it. If you have a lot of cash on hand (above $50,000), the rate jumps above a 5% APY, which is approaching certificate of deposit rates just sitting in your checking. That’s truly impressive and is the real calling card of the Electric Orange account.

Free ATM Access
The account offers a MasterCard debit card that also functions as an ATM card. Nothing special, except that the card is part of AllPoint, which means that there’s a huge number of ATMs all over the United States that you can use this card at with no fees. I checked the list and there are usable ATMs all over near where I live that can use the card.

$1000 Overdraft Line of Credit
As if those features weren’t enough, the account also offers a $1,000 overdraft line of credit, which means they’ll cover any minor overdrafts for you automatically with no fee, instead just charging you a finance charge for the amount that you overdraft. This makes money management a bit easier for some, but with that kind of interest rate, I won’t feel so bad about leaving plenty in the ol’ checking account.

The existence of this account is going to really shake things up in the checking market – I expect that other banks will again be following ING’s lead and offering similar rates and features. With features like these, the consumer wins.

The Negatives

No Local Branches
I don’t mind using ING for savings, but I often use my local bank for additional services that largely require a teller unless you want to pay a fee elsewhere. What if I want to acquire $60 in quarters (this happens regularly for me, as I often play poker with dimes and quarters with friends)? What if I want to just immediately cash a check without delay? It’s going to be hard to do these things without any local branches.

No Checks
This is the one that really worries me. The Electric Orange account doesn’t allow you to actually write a check. If you actually need a paper check, you have to request one online and wait for them to print it and mail it to you. This isn’t a problem if you exist in a mostly checkless environment, but I live in a rural area where many people (including the local grocery) only accept cash or check for incidental payment.

And The Conclusion

I admit it – I’m unsure about what to do. My thinking right now is to switch to it as my primary checking, but maintain my old checking account with a small balance in it for the check-writing convenience, and transfer money to the old checking from time to time when I need to. This would enable me to take advantage of their tellers for check cashing and change needs as well.

If you have any thoughts, I’d love to hear them.

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  1. matt says:

    How does one deposit checks with this type of account?

  2. rob says:

    This is pretty much how we live but through USAA. With my company paying through direct deposit, the only checks we receive are usually for birthdays and holidays. So the downside is no cash on hand, but it’ll be there in a day or two. However, we do have a checkbook and still need it for some bills and transactions. I’d rather go paperless, but not everyone wants to! ;-)

    We also get reimbursed ATM fees up to $20/mth so we can go anywhere.

  3. ruthie says:

    There are a couple other internet banks who offer high-interest checking as well… I’ve heard good things about Presidential ( http://www.presidential.com/ ) despite their 1992-esque website. They are offering “4.50% APY on balances up to $25,000. Balances in excess of $25,000 earn a competitive 2.75% APY.” Which makes more sense to me, because honestly, I really don’t think you need to have $50,000 to $100,000+ just in checking, even if it IS getting 5.30% APY (also, there are several online savings accounts where you can get that much interest or more ( http://www.savingadvice.com/forums/showthread.php?t=19240 ) and it is much more likely that you would be earning the 3% APY. Most people expect to earn more than that from their investments, so I can’t really understand why you would let any significant amount of money wallow in checking account for too long, even if it is “high-interest”. AND they offer a free initial 25 checks plus the ATM access, free Visa debit card, etc that ING is planning to offer. Unfortunately, there is still the issue of not having an actual brick-and-mortar bank in most areas, which means you have to mail checks to them, and can’t get (or give) small change from (to) the bank if you need it.

  4. Dave says:

    If you can’t deposit funds directly, you deposit checks by either keeping the old link to your physical bank account and transferrings once its in there, or you can mail checks to ING and they’ll deposit them within 5 days.

  5. bankaholic says:

    did you figure out how to get direct deposit from employer working?

  6. Pope Ratezinger says:

    Yeah, I agree with Ruthie. I just don’t think that this ING Electric Orange product, despite the advertising budget they will probably launch with, is all that good.

    I’ve been waiting awhile for ING to finally launch a checking product. I assumed ING was simply taking its time to work out all the bugs and provide a good product.

    Electric Orange? After finally getting details, I’m thinking Electric Lemon.

    When I open an online checking account, I don’t want to regret not using a traditional kind of bank. In other words, you want ATMs. You want easy deposits. You want to write checks.
    Electric Orange doesn’t offer paper checks. Rather, you must “write” a check online, and ING will mail it to the waiting recipient. Not exactly an ideal arrangement when paying the kid who cuts your lawn, right? I’m sticking with EverBank and 6.01%.

  7. Joe says:

    I think using an online-only account like Electric Orange as a primary checking account works well. As a backup brick-and-mortar institution for cashing checks, getting quarters, etc. I use my local credit union, which is practically fee-less for everything.

  8. Richard says:

    My question is this – if everyone does this, then Paypal goes out of business, no? Sellers can collect secure, instant payments and pay no fees, correct? No one seems to realize this, and Paypal makes millions off of ridiculously high fees.

    There’s no reason you can’t have both accounts, all you check nay-sayers. I mean, if you are paying the cable and utilities and mortgage totalling $3000 a month and you pay the lawn kid $30, do both. (Or set up a recurring payment to the lawn kid and you’re winning on all fronts).

  9. Michael says:

    Here is a thought. You can still order checks from printing companies. If you have your account number and your routing number. wouldnt this be a simple solution?

  10. Jenny says:

    Michael- In response to your response, it says on the ING Electric Orange FAQ section that any 3rd party printed check with your account information will not be accepted. So, yeah.

  11. Steve says:

    I have an INGDirect account because the bank took over my account after Netbank failed. I read over their info and somehow I didn’t notice that their checking account would have no checks. It just never occurred to me that a checking account would not have checks. I decided to give it a chance but I got screwed.

    The first was an electrician. He did $200+ work on my house and wanted payment and I don’t keep money like that in my wallet. What was I supposed to do? Fortunately he was able to use my debit card by calling in the number to the main office. What if he didn’t? How the hell would I have paid him? Ask him for his checking account number and bank’s ABA then let him watch me send him the money online? I’ve actually done this with someone and it takes a few days before they get a sign that money’s been sent to them! UNACCEPTABLE!

    Second: I wanted to buy two 1oz platinum coins from a local coin dealer and they wanted checks or cash. Obviously, they wanted the money immediately. Platinum was $1700 an ounce so there’s no way I wanted $3400 on me even if I could pull that much out of an ATM. My IGN account made this impossible so I opened a Bank of America account. It’s been nearly 2 weeks since starting that process and platinum has risen $300 an ounce (even oil doesn’t rise that fast) so this damn “convenience” of paperless checking has cost me at least $600.

    I considered keeping both my IGN and BoA accounts but I’m going to close my IGN one now because I’m so angry at this situation.

  12. Roger says:

    In response to steve… Stop stirring the pot! For your usage, ING is not for you. Period. As far as getting screwed out of $600? Are you serious? Look, if you have the money to invest thousands in precious metals, then you better know how to manage your money. And if you know how to manage your money, there would never have been any mystery on how your primary bank allows you access to it. All you are doing by making that statement is to trash ING because you didn’t know how to manage your cash account. I can’t stand inflamatory remarks that discourages people to investigate the pro’s of having this type of account. If you hold thousands in an ING checking, as you say you do, you will recoup the loss in due time… In a traditional account, you will only lose more money in bank fees for ATM access with no hope of gain. But you need to understand HOW to play the game. If ING allowed checks, then they would need to have branches… and significantly larger staffing… Keep it digital as much as possible. That is where the money is at! If this isn’t for you, don’t trash them because you don’t understand!

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