Ally Vs. Ing Direct: A Face Off!

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Ally versus Ing Direct: which bank is better?

Ally and Ing Direct are two of the most popular online banks in the US with no physical branches. Ing Direct is owned by the Dutch financial group, Internationale Nederlanden Groep and Ally is the financial arm of General Motors, formerly known as GMAC. (ING group has agreed to divest US operations of Ing Direct to Capital One. The sale is expected to close in the fourth quarter of 2011.)

Being online banks, both the banks can afford to offer very aggressive rates when compared to traditional banks. But between them, which one offers the best value for your money? Let’s find out!

Rates

Let’s start with the rates. (As of Aug, 13, 2011)

Ing Direct
Orange Savings Account: 1.00% APY
Electric Orange Checking ($0 – $49,999.99): 0.25% APY
Orange 12 month CD: (12 months) 0.75% APY

Ally
Online Savings Account: 1.00% APY
Online Checking Account ($0 – $14,999.99)): 0.50% APY
High Yield CD (12 months): 1.19% APY

Winner: Ally

Paper Checks

Paperless transactions? We are almost there! But for that ocasional payee who insists on a paper check, having this option is useful.

Ing Direct: You can order a checkbook containing 50 checks for $5.00 with an Electric Orange checking account.

Ally: Checks can be ordered for free with Ally’s checking account.

Winner: Ally

Access to ATMs

If the banks don’t have physical branches including dedicated ATMs, what about having access to cash?

Ing Direct: Ing Direct has tied up with Allpoint Network and charges no fee if the ATM card used at any one of the 35,000 Allpoint Network ATMs. That is more than what Bank of America, Chase or Wells Fargo provides. Allpoint ATMs are available at Target, Costco, 7Eleven, CVS, Kroger and Walgreens.

If you use your IngDirect ATM card at a non Allpoint ATM, IngDirect will not charge you a fee, but you will be responsible for any fee the ATM owner might charge.

Ally
Use at any domestic ATM. Ally will reimburse all charges at the end of the statement cycle.

Winner: Ally

Online BillPay

Goodbye stamps and one less excuse to not pay your bills!

Ing Direct: Free with Orange Checking account

Ally: Free with Ally Checking account

Winner: Tie

Check Deposit

How would you cash in mail-in rebates?

Ing Direct: You will have to mail in the physical check. IngDirect does not provide free check deposit envelopes

Ally: Like IngDirect, you will have to mail in the check. Ally, upon request will provide postage paid check deposit envelopes

Both banks offer remote deposits via check scanning.

Winner: Ally

Foreign Transaction Fee

Not having to carry wads of foreign currency is liberating!

Ing Direct: If the check card is used overseas, a currency conversion fee of 2% is charged by MasterCard

Ally: A fee of 1% is imposed if the ATM card is used overseas

Winner: Ally

Website Ease Of Use

Ok, this is purely subjective, but here goes…!

Ing Direct: I find Ing Direct’s site to be more user friendly than Ally’s. Nothing in particular stands out, but never had trouble finding what I was looking for. FAQs are very well thought out and has excellent search.

Ally: Ally certainly has a well thought out layout, but if I were to choose between the two, I would pick IngDirect for ease of use.

Winner: Ing Direct

Overdraft

Now that the outrage over this service has died down, I still think this is a valuable option. Opt-in, but be responsible.

Ing Direct: If you overdraft, IngDirect will honor the transaction if it is within your overdraft limit and will charge you an interest on the difference.

Ally: There is a charge of $9 per overdraft. However, $9 is the maximum per day. If you have two OD transaction in a single day, the charge is still $9.

Winner: Ing Direct for simplicity

Wire Transfer

Convenient and quicker than writing a check.

Ing Direct: Ing can only receive wires and that too only domestic wires. There is no way to do an outgoing wire transfer with IngDirect.

Ally: Can receive and send both international and domestic wires. There is a fee for outgoing wires.

Winner: Ally

Deposit Hold Time

Long deposit times are one of my pet peeves!

Ing Direct: If you make a deposit via a linked external bank to your IngDirect account, the transfer time is about 2 days and in addition, there is a 5 day holding period imposed by IngDirect before the money is made available.

Ally
Standard 2 day transfer time, no holding period I’m aware of.

Money is made available immediately for an intra-account transfer for both the banks.

Winner: Ally

Mobile App

Mobile banking through a smartphone is cool… just don’t lose your phone!

Ing Direct: Has dedicated apps for iPhone, Android and Blackberry devices.

Ally: Has dedicated iPhone and Android apps.

Winner:Ing Direct

Bailout Money

The taxpayer was the real loser here!

Ing Direct: IngDirect’s parent group ING, received bailout money to the tune of €10 billion from the Dutch government. The sale of US operations of ING Direct to Capital One is, in part, a plan to repay this loan.

Ally: GMAC as Ally was formerly called, received a $17 billion bailout from the US.

Winner: Ok, at the current conversion rates, €10 billion is less than $17 billion. I’m going with Ing Direct!

Conclusion

Ally Bank emerges the clear winner with good rates, more services and less fees. Ing Direct still beats brick and mortar banks hand down and if you are a ShareBuilder user, using Ing Direct makes sense for quick money transfers between your ShareBuilder account and your Ing Direct checking or savings account.

Recommended Read: 10 Questions You Must Answer To Stay On Top Of Your Portfolio

Attribution: Image modified in accordance with creative commons license.

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69 thoughts on “Ally Vs. Ing Direct: A Face Off!

  1. Excellent post! It was a little touch and go there for a second but Ally pulled out all the stops! :) Ally just needs to create a mobile app and they will win over all of the younger consumers.

  2. Thanks for the breakdown! I’d go with Ally because of the holding period. We now have money in ING as an emergency fund, but I’m thinking of switching to Ally. Thanks very much!

  3. Ouch on the savings rates at all banks, huh? It seems sad that the best rates out there are only around 1%. Thanks for the breakdown on everything!

    • The traditional brick and mortar banks offer rates as ridiculous as 0.10%!

      As long as the feds keep the rates low, this isn’t going to change.

      • Its amazing to me how much savings rates suck! Its not even worth it to have a savings account as some banks have a monthly charge if you don’t reach their minimum deposited amount per month. Ally bank in my book always beats out ING direct just as moneycone stated above, that they have an unreasonable holding period.

  4. Nice analysis. I’m surprised that Ally was so dominant. I’m sure ING is watching Ally closely and will have to get more competitive as consumers understand the advantages of Ally.

  5. I never really noticed that they are both solely online! How funny! I don’t know how some banks manage all their overhead. Chase has branches almost every couple blocks in SF with some just 1 block apart. Really helpful comparisons on Ally and ING Moneycone! Thanks -Sydney

    • Having no branches is the reason these banks are able to offer such good rates (relatively speaking of course!)!

  6. I’m glad that you posted this now because I am just beginning to shop for an account to replace my HSBC online savings. Ally looks to be very competitive.

  7. Cool! I was about to open an ING account, but now I think I’ll go with Ally instead.

  8. Oh dear. Clear logic in your article…but something about that orange ball just makes me happy:).

  9. You just gotta hate seeing that low APR advertised as a good rate, but you gotta have money in the bank. May as well get the most you can!

  10. I have both accounts but really like Ally. For one, Ally had higher interest rate for a long time. They have always been very helpful to me. I am thinking of opening my business checking account with ally.

    • Customer service is pretty good with both the banks from my experience as well.

      • I realize that it’s quite a while after this post was written, but do you still find the customer service at Ally to be good? I just had a *horrible* experience with TD Bank and I’m considering other banking options. I’d appreciate your input. Thank you!

        • I don’t contact Ally’s customer support that often. But when I do, they are pretty responsive. The last time I had to contact them was for new ATM cards since the old ones were expiring. They asked me to confirm the address they had on file and once I did that, got the cards promptly. All this was via email though- never actually spoke to anyone.

  11. I agree, non-brick-n-morter banks can definately offer more competitive rates… 1% is not much, but better than what some CDs (which have penatalities if you need to take money out early unlike savings accounts) pay at brick-n-morter banks!!!

  12. Timely article, just written for me :). You just saved me a bundle of time, doing the legwork for me. Now I know which online bank to choose!! Thank you.

  13. Two additonal points:
    Bankrate.com gives Ally Bank a ***** rating while ING Bank has a **** rating. However, Capital One Bank has a ***** rating, so this is a tie. (But you know your deposits are as safe as can be)

    Bill Pay and eBill. I have compared both systems and am somewhat biased by what Wachovia offered. It is simply the best out there but it is gone that Wells Fargo took them over and replaced it with their second rate system. ING Direct used the same system that Wachovia did and appears to be the same top rate system. Ally uses a good system, but it doesn’t appear to be as good al ING’s in the eBill area. So I have to give the vote to Allyl I haven’t decided which I will go with as it is a tough choice. It will depend upon whether the wife is comforable with using the Allpoint ATM’s in supported locations vs. ATM’s operated by banks.

  14. My husband and I just cleared up a misunderstanding about online only banks. I thought he refused to use them but I guess I misunderstood the conversation, so now I’m looking into them for the very first time.

    More proof that you need to make sure you are communicating with your spouse. :)

  15. Wow felt like watching a heavyweight fight! Nice breakdown as usual. Perhaps you have another career working at Consumer Reports!

  16. Great breakdown, as usual. I’ve been online banking for the past 13 years. The only disadvantages that I can think of is 1) Cannot make cash deposits and 2) It takes at least one business day to receive a cashiers check, if needed. Otherwise, online banking is great.

  17. Cool comparison! I’ve been so out of touch with banks of late given the negative real returns, it’ll probably be years before I start searching seriously for yields there again. Will be interesting to see how the field looks when we finally see rates increase.

  18. Great comparison but I gotta ask if Ally offers the subaccount feature that ING Orange offers. I think that’s one feature ING Orange can tout as being unique about their online banking experience. Thoughts?

    • You are right LH. This feature is missing in Ally. It is easy to open additional accounts, but they are still treated as a physical account and not as a sub-account.

      • I don’t think ING’s accounts are “sub” accounts, they are separate, just easy to open. i.e. a sub account to me would be account# plus 1, for first account, 2 for second account, etc.
        ING’s accounts are all different account numbers, like Ally’s would be, but the setup at ING is truly easy to do.

        • Thanks for the clarification Ed. I always assumed these were sub-accounts! If these are indeed separate accounts, then really this can be done with Ally as well.

  19. I’ve used ING for several years now and I really can’t complain about them.

    Started an Ally account a couple months ago specifically so that we could have paper checks.

    Feature wise, Ally has an edge, although the fact that it’s impossible to use a smartphone with it – not just a special app, but even via a web browser – is a disadvantage to me.

    But I’ve heard bad things about Ally’s customer service.

    If ING didn’t have the ridiculous $5 check fee, I would be switching back, simply because I already have a good experience with them, while Ally still needs to earn my trust. But $5 per 50 checks is ridiculous – they don’t have to provide them for free, but at the local WalMart I can get 200 checks for under $7 – so Ing isn’t getting any love from me on this.

    • I use both Ing and Ally and from a customer service point of view, I think both are equally good. I don’t call often, but whenever I did call, it was easy to talk to someone and the customer service reps from both the banks were very helpful.

      Both banks are quite prompt with replying to emails as well.

      Personally, I feel Ally offers better value for my money (higher rates, lower fees and freebies like free checks).

  20. great post, another plus for ING Direct is their new product called MONEY. It is just what I have been looking for as a way to teach my kids financial mgmt skills — really great. they also have a contest running that all of my kids have entered attempting to be ‘money’ with their picture on a billboard in times square — fb.com/thatsmoney

  21. I have accounts at both, I started with ING and still do my mortgage bill pay account with them, just due to the ease of use of their website. Love their bill pay system! I like the daily interest tally (current and last years)at the top of the page too ;)

    I haven’t had to focus on some of the other issues, b/c I use a local credit union too (ATM use).
    I have noticed that Ally for some reason takes 1 extra day with the holding of funds or maybe it is late afternoon when they are released? I ran a test where I had both Ally and ING pull money from my CU checking account on Wednesday. ING was available on Friday morning when I checked (in Orange Direct not savings) and Ally was still unavailable. On Saturday Ally was available but I didn’t check again on Friday afternoon.

    Ally will let you link your Ally savings to your checking and not charge you a overdraft fee if you exceed your balance.
    I am starting to think I should move it all over to Ally!

    One more thing–I noticed that when you bill pay through ING, they take the money out right away (then send the check), where ALLY doesn’t take it out till the day the bill pay was scheduled (sends the check on Monday for a Friday delivery and takes the funds on Friday). Gives a couple more days of float!

  22. Ally MMA went down to 0.99%
    INGdirect savings still at 1%

    winner: IngDirect

    So I moved half the money in that Ally account to IngDirect savings while keeping the other half in the MMA for Ally’s overdraft protection.

    Overdraft protection comes free with Ally MMA — though you do have to enable it; they auto-transfer $100 from the MMA to the checking every time you overdraft the Ally checking account which counts against the 6 transactions — so no $9 charge when using their overdraft protection — hmmm winner: Ally, unless you like paying interest with INGdirect’s overdraft protection — I don’t. Honestly, I never had to use this service, but I guess it works unless someone says otherwise.

    Drat … forgot about the 5 day hold, perhaps not worth transferring for .01%; ah well, too late, but then Ally could continue to drop — that was my thinking when I made the transfer.

  23. Great post.

    Does Ally or ING charge a fee to transfer funds OUT of their accounts to another bank? I can transfer funds to Wachovia for free but transferring back out costs me $3.

    Thanks all.

    TomW

  24. Thank you so much for this post. I just ordered the checks from ING. While it would be an extremely rare occurrence that I would need one, I figured for $5, it was worth it. WRONG! They put my physical address on the checks instead of my mailing address, which is what I use for everything, and is the address they printed on the little front slip on the book of checks that shows through the little plastic window in the envelope. Why on earth they would use the wrong address on the checks but mail them to the right one is beyond me. I called and tried to fix it, only to be told that I would have to activate the checks, then deactivate the checks, and then pay $5 more dollars for new checks. I’ll give them the opportunity to take responsibility for their mistake and replace the checks they screwed up, for free, or I’m moving to Ally. The phone rep, who was polite-not mad at him, readily admitted the whole check thing was new and that he “could pass on the request that their check sign-up process be updated to let people know which address will go on their checks”. So they take my money for a faulty product due to a faulty process and tell me I need to give them more money to fix it. Not gonna happen.

    Thanks again.

  25. I’ve been monitoring my INGdirect account for a week to make sure; I’ve found that the five day hold is no longer accurate — if you’re a member in good standing. First time this has happened to me — the transfer took a day and was available in my INGdirect savings account even before it was out of my Ally MMA.

    So winner: INGdirect … if you’re in good standing.

    But how do you know if you’re in good standing? It’s not like they e-mailed me about this; I used Google to 411 this. So I’d say, transfer a low amount that you can part with for a week and see what happens. If it takes a day, hooray!

    However …

    Ally beats INGdirect with how many external ACH transfer accounts you can have; I believe it’s around 20 unless they changed their policy. With INGdirect it’s 3 external accounts.

    With Ally you can open multiple checking accounts, all with free checks and free debit cards. You can only open multiple savings accounts with INGdirect, not checking accounts (at least I couldn’t find a way). Multiple checking accounts come in handy when wanting to keep track of various expenses without worrying about the 6 transaction limit.

    Hope I didn’t come off sounding rude in my prior comment (I was hungry and in a rush) — people may need that line of credit that INGdirect provides; they may not be able to afford their own overdraft protection and can’t keep at least a couple $100 in an Ally MMA account at all times, so perhaps that’s a tie depending on your individual money situations.

    With INGdirect Savings at 1% while Ally MMA is at 0.9% and now that INGdirect has quick ACH transfers for members in good standing then INGdirect wins.

    However, since Ally offers free checks, and they’re checking account is at 0.5% over INGdirect’s 0.25% then Ally wins.

    I think both banks are great, depending on which account you’re using, so I’d say there’s a tie. Use the one that best suits you or do what I do and use both — Ally for checking and INGdirect for savings.

    I’ve never had any problems with either bank , they’ve always come through for me and they’re both awesome banks (so far).

    The only catch with online banking is that there is no free way to get cash into these banks; if anyone knows of any free way aside from using a local brick and mortar bank that may no longer have free checking (so not free) and also discount the credit union banks that not everyone can get into, I’m all ears.

  26. dazed but not totaly confused says:

    Being fed up with the fees I’m being charged by Wells Fargo to have my piddly checking/savings account with, motivated me to start researching banks that waive these fees and I came across this site. I’m pretty clueless with anything pertaining to finance/money/banking/investing and having had my own banker attempt to explain what it all means and what’s best for my needs has been the equivalent of trying to figure out what Charlie Brown’s teacher is saying…

    I’ve heard of ING and Ally but had no idea that ING and Ally were strictly on-line banks… I seem to recall seeing an ING Direct building before but now realize it is one of their “cafes”; not a bank. Anyway, you broke everything down into laymman’s terms and then compared their differences and made it really easy to understand; I appreciate that. Thank you, thank you, thank you.

    No need to Sharebuild (yet) so I’m going with Ally for sure! Again, THANK YOU

    • Comments like these make a blogger’s day! Thanks for the kind words dazed!

      When it comes to banks we have choices. If everyone was as smart as you in researching before forking over their savings, there wouldn’t be predatory banks in the first place.

  27. Here is an update from ING Direct that I received last week: In June, we let you know that we would soon have a new shareholder. On February 17, 2012, our parent company – ING Group – announced that ING DIRECT USA was officially purchased by Capital One. We are proud to bring these two great companies together.

    What’s it mean for you today? It’s business as usual. You’ll still be able to access your account online, view balances, pay bills – everything that you were able to do yesterday. And rest assured, your money’s still safe and FDIC-insured.

    What else can you expect?

    For starters, coming this spring, you’ll have access to CheckMate, our new remote deposit service. You can deposit checks directly into your ING DIRECT accounts anywhere from your computer or the ING DIRECT mobile app.
    If you use Electric Orange checking or MONEY, you’ll be able to withdraw cash at any of Capital One’s over 2,000 fee-free ATMs – that’s in addition to the 35,000 free Allpoint ATMs you can currently access.
    What’s it mean for you down the road? As part of the Capital One team, we remain committed to offering innovative products and maintaining the same Customer service and experience you’ve come to expect while saving you time and money.

    As always, thanks for being part of America’s favorite place to save.

    P.S. For more information, visit our Customer Information Center.

  28. You left out the most important feature for those of us who do online banking – customer service and peace of mind.

    Ally has a terrible reputation for customer service – I am surprised you didn’t mention that. If you don’t believe me, check the BBB web site. Although Ally is not registered with BBB (? why -many other banks are) it ranks in the bottom 2 of 358 banks in the US for customer complaints.

    ING has a great reputation – I have banked with both institutions since 2007-08 and I trust ING to take care of my money without making mistakes. In fact, when I made a mistake and sent an online payment to the wrong account, they let me immediately delete it. Never had a problem opening or closing CDs, and they let me set the terms online, myself, and change them right up to the maturity date. Not so Ally – you have to go through a customer rep. And their track record of making mistakes is rather frightening. I just had Ally roll over a CD when I had specifically asked it be closed, and made the request several days prior to the maturity date.

    If you don’t believe me – just search for ratings of Ally Bank’s customer service.

    So for customer service and peace of mind: ING is the winner by a landslide. I just hope that Capital One doesn’t screw that up.

    • Thank you this was very helpful. I current use ING and am very happy. There were some nice features on ally which I could use but I don’t actually need them.

    • INGDirect added mobile check deposits just the other week. ally representative said they should have one by the end of this year as they just released their mobile app.

      One other difference is that ally allows multiple checking accounts with a debit card for each (nice for compartmentalizing) whereas ING Direct only allows one checking account.

  29. Thanks for the information, this makes me much more confident in deciding to open up an account at Ally after getting .01% at Citibank.

  30. INGDirect added mobile check deposits just the other week. ally representative said they should have one by the end of this year as they just released their mobile app.

    One other difference is that ally allows multiple checking accounts with a debit card for each (nice for compartmentalizing) whereas ING Direct only allows one checking account.

    (OP, please disregard the other duplicate post, I replied to the wrong thread)

  31. I’ve been an Ally customer for approximately 4 months.

    During that period, my place of employment has attempted to direct deposit my paychecks into Ally, but the deposits were rejected. I then tried to e-check deposit my paychecks….which Ally held for 12 days EACH time before depositing. In the mean time, I had checked and double checked and triple checked that the account information that was being used was correct. Each time I called Ally I was subjected to yammerings about account numbers that I’ve confirmed and hold times I find excessive, given the fact that it’s a salary check for the same amount every two weeks. But, I figured it would all be fine when the direct deposit issue was fixed.

    After five attempts, my accounting department said “Good news, your deposit has been accepted!” and I was so happy. But on deposit day, my money wasn’t in my account. My pay stub said “This is not a check” and Ally said “We don’t know where your money is…but it may take us 24 to 48 (business) hours to research it” On a Friday that means I won’t hear from Ally until Tuesday, and if they DO find it, I’m sure they’ll come up with a reason to hold it for another 12 days.

    The worst part…while speaking with a customer service supervisor (almost as useless as a customer service representative, but with a more authoritative sounding title) she indicated that there was no way to further expedite my resolution, as it was a newly opened issue. WTF? I’ve been calling over and over for months about the same issue. Maybe it’s a bit different than the last eight calls, but it still boils down to the same. little. nugget. My direct deposit isn’t being deposited and Ally won’t give me my money.

    The fee-less accounts, the interest, the convenience, the friendly customer service, the e-check deposit…it all sounds fantastic, but BEWARE. You’ll continuously call with the same issues. You’ll wait weeks for access to your own money and there is no direct line to the resolution center…leaving you at the mercy of friendly, but relatively helpless customer service reps (and supervisors).

    I’ll be posting this review on every available site for each waking hour that my funds remain missing in some Ally limbo. At the earliest availability I’ll be removing my money and marching it straight toward the teller of a better bank…if there is such a thing.

    Wish me luck.

  32. I’m a loyal ING customer. Btw, ING Direct now offers check deposits via image transfer.

    The overdraft protection alone is enough to keep me with them indefinitely. I can overdraft up to $250 at a time and pay virtually nothing. This protection has saved me a number of times over the past seven years I’ve been with them.

  33. Apparently Ally does not allow businesses to open checking accounts. Does ING Direct?

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