ING Direct

[~NeonFire~]

Is ING Direct [Canada] safe to use? I've had an account with them for about a month now and I have a fair amount of money in it as well as a GIC opened with them but it seems like horror stories on the web about ING Direct are way too common and most revolve around people's money being locked because their information couldn't be verified or whatever. Since I'm new to all of this and have no creidt cards or anything, I wasn't listed in the credit bureaus so when I opened up my GIC, for "anti-money laundering purposes", I needed to fill out this form and have a professional (doctor, lawyer, etc) sign it to prove that I was who I said I was. I also had to send in some of ID and one of the options was a birth certificate so I sent a photocopy of that through the fax along with the form.

I read one horror story about someone who's account was locked because they entered a P.O. Box for their address (instead of an actual physical address), but I live in an unincorporated rural area that technically doesn't have street names and my address is my P.O. Box. I live on a road that isn't named in a community that isn't legally named outside an incorporated town, so if I ever had to prove my address, I don't know how I'd do it and then I wouldn't be able to access my money (if these stories are true).

I don't know, there's just something about banks that don't have branches and are 100% online/over the phone that worries me. Am I being too paranoid? I absolutely love the interface of the site and the way you can manage your money and the high interest rates on both savings accounts and investments, but for some reason I'm debating closing my account and moving my money back to Scotiabank where it'll earn absolutely nothing but I'll have that added comfort of being able to speak with someone in person at my local branch...

Opinions?

[Julie Rains]

I think if you are uncomfortable with the situation, then you should change banks.

I haven't heard about the horror stories but I can see how online banks would need to have certain forms of ID (including a real address and not a PO Box) and how that could cause unintentional, legitimate problems that could lead to freezing your account, etc.

I have had similar problems with online providers because of how an account was set up and then how I tried to access it with a work rather than home address, or in my husband's name rather than my name, etc., and I can tell you that certain rules meant to protect the provider from fraud don't seem to be bendable.

So while the money may be safe (assuming there are FDIC-like provisions protecting your money), you may not be able to get to the money.

On the other hand, I think there are horror stories about every company online...but it doesn't hurt to do your own investigation.

[~NeonFire~]

Originally Posted by Julie Rains

I think if you are uncomfortable with the situation, then you should change banks.

I haven't heard about the horror stories but I can see how online banks would need to have certain forms of ID (including a real address and not a PO Box) and how that could cause unintentional, legitimate problems that could lead to freezing your account, etc.

I have had similar problems with online providers because of how an account was set up and then how I tried to access it with a work rather than home address, or in my husband's name rather than my name, etc., and I can tell you that certain rules meant to protect the provider from fraud don't seem to be bendable.

So while the money may be safe (assuming there are FDIC-like provisions protecting your money), you may not be able to get to the money.

On the other hand, I think there are horror stories about every company online...but it doesn't hurt to do your own investigation.

I think once they have confirmation of my Scotiabank account, a copy of my birth certificate and a signature from a notary public that I'm who I really am, they can assume that I'm who I say I am. I don't see how having a "real" address makes a difference when I live on an unincorporated road that technically has no name.

Of course they wouldn't understand that in Toronto, because every part of Canada is like Toronto, right?

When I go (very soon) to university and live on campus, I have no address there either other than a P.O. Box I can rent, and I assume my ING address has to match my Scotiabank address and I'm not looking forward to that process because Scotiabank is so stubborn about their "home branches" or whatever, my "home branch" being 7 hours away from me doesn't seem that sensible but since I won't have a physical address at uni either, I'll probably be forced to keep my home/main branch the one that's here now, and for some reason everything has to go through that one. So I have to drive 7 hours to my "home branch" to do a transaction that can't be done on an ABM/ATM?

I hate banks. As much as I love ING's interface and their interest rates, my instinct tells me to drop them and withdraw my money while I can... and then go back to my wonderful 0.0000000000000000000000000000000000000000001% interest rate at Scotiabank. Blah.

This is a story that kinda goes hand-in-hand with my situation:
http://www.blogalley.ca/2006/12/ing-direct-sucks/

[Julie Rains]

The PO box thing doesn't bother me but it does some banks (I have similar problems in which I could set up an account but not get it serviced correctly b/c I chose to get a secure PO Box rather than use mailboxes on the road that anyone can access).

Anyway, you could "test" ING just to see if you have problems before you actually need the money; also you could see if Scotiabank has some sort of student account that wouldn't require the same use of addresses and home banks, etc.

[~NeonFire~]

Originally Posted by Julie Rains

The PO box thing doesn't bother me but it does some banks (I have similar problems in which I could set up an account but not get it serviced correctly b/c I chose to get a secure PO Box rather than use mailboxes on the road that anyone can access).

Anyway, you could "test" ING just to see if you have problems before you actually need the money; also you could see if Scotiabank has some sort of student account that wouldn't require the same use of addresses and home banks, etc.

What exactly do you mean by "testing ING"?

[Julie Rains]

Re: testing

I mean if you have an account now, go ahead and ask for money to see if you can easily transfer money to your regular brick-and-mortar bank; or if you can get money sent to your PO Box. You could test a small amount just to make sure there are not additional conditions they failed to tell you about.

You could possibly have problems later if you withdraw a much larger amount or if the bank changed its policies; but you might catch any problems now rather than later when you need the money urgently. Just an idea.

[~NeonFire~]

Originally Posted by Julie Rains

Re: testing

I mean if you have an account now, go ahead and ask for money to see if you can easily transfer money to your regular brick-and-mortar bank; or if you can get money sent to your PO Box. You could test a small amount just to make sure there are not additional conditions they failed to tell you about.

You could possibly have problems later if you withdraw a much larger amount or if the bank changed its policies; but you might catch any problems now rather than later when you need the money urgently. Just an idea.

Oh, I can electronically transfer money back and forth from Scotia to ING via their website but I'm just worried about finding out one day that my account has been suspended or frozen because they need extra verification (before, when I tried to open a GIC, it told me to "immediately call 1-800-whatever" without explaining and when I did, they told me they were sending out a form I needed to fill out and get signed and include ID (birth certificate, etc) with it, so I did and then they removed the restrictions from my account. I just hope this doesn't happen again with an address-related problem because that's something I can't fix.

It's my mom that has me worrying. I told her on the phone one day that I switched to ING Direct and she's been with Scotiabank her whole life and she started yelling at me and complaining that I was trusting some "internet company" with my money and that ING would "disappear one day with my money", but they are CDIC-insured, so she keeps getting into my business and saying I should go back to Scotiabank now and it's starting to get to me - not because I'm worried about ING Direct's reliability but because I'm worried that my non-existant address will cause problems in the future.

I'm the type of person who's willing to take the risk but something tells me that in a year or so, I'm going to need to withdraw my money and I'm going to be going through a long process to get it. I'm not exactly an optimist.

I just hate Scotiabank so much, and the other big brick-and-mortar banks aren't any better. The Scotiabank online banking UI is so bad my eyes bleed when I try to use it, their interest rates are so bad that my savings would grow faster in a piggy bank, everything about the bank and their policies make me cringe but I have that secured feeling that if something goes wrong, I can visit my local branch. With ING, I have to deal with someone on the phone 3000 miles away in Toronto.

[KevinW]

FWIW, I've had an ING Direct account for over 2 years, and have moved several times over that period, and never had a problem with my account being locked. I am a thoroughly satisfied customer.

You and/or your mom may be comforted to know that ING is a large, relatively conservative, international bank based in the Netherlands. It's not some fly-by-night "internet company."

That being said, if this arrangement is causing you anxiety or strife, you should change it. You might consider opening a money market account with a mutual fund company such as Vanguard or Fidelity. Money market funds yield about the same interest as online savings accounts, and the companies are bigger household names and some have brick-and-mortar branches. The downside is that they are not FDIC/CDIC insured and their interface and policies are more oriented toward 'investing' than 'banking'.

[jkuo13]

I don't know if there's a significant difference between ING in the US and Canada, but I've had an ING account for several years in the US without any problems. I once had to call them when Netbank went under and my defunct Netbank account got merged with my ING account. Whoever I was talking to was nice and pretty helpful. My ING banking experience has been pretty trouble free so far.

If you're concerned with being frozen out of your account, you could just maintain two accounts. Keep what money you're comfortable with in ING, and keep a back up sum in a regular B&M bank just in case you temporarily can't access your funds.

[Babalu]

ING doesn't pay the highest interest rates. You lose the convenience of a regular bank using them, and it's tough sometimes if they find a reason to lock up your account. You should carefully check the bank's rates, no matter which style you choose.