ING Direct Decreases Interest Rate Again

Updated October 4, 2009 with new interest rates.

The recession is becoming more and more present every day as lives are changed and financial situations are completely flipped upside down . Those of us still seeking returns for our savings are looking towards the less traditional methods of saving such as online savings accounts. Among those newer online banks is ING Direct. Once boasting a huge interest rate (over 5% interest) compared to brick-and-mortar banks, ING Direct has slowly but surely decreased in the rate offered, and now has come down to 1.85% 1.65% 1.50% 1.30% as of October 4, 2009. The rate is fairly close to par with the other major big online banks as everyone is hurting right now due to the recession.

Personally, I only recently opened up an ING account for a very specific purpose and do not actually have any of my money in it for the interest rate so the recent decrease does effect me as it may others but on that same topic, I want to discuss another option.

ShoreBank Direct

I have only recently been looking into the high yield savings accounts as of January 2009 because I wanted to start making smarter and safer investment decisions. Too little too late some may say, but ShoreBank Direct is still offering an above 3% interest rate (3.15% APY) (2.80% as of March 09) (2.45% as of April 09) (2.15% as of August 09), which is higher than many of the other financial institution’s CD (Certificate of Deposit) rates currently. So this is where I landed and have been funneling some of my access cash into lately. I am not fully sure why there have not been more reviews floating around the net about ShoreBank Direct and its escalated interest rate compared to the slumping market but here are a few of the key points about the bank.


  • The obviously higher interest rate of 3.15% 2.80% 2.45% APY 2.15% APY
  • 24/7 Online access
  • $1 Minimum to open.
  • 6 free withdrawals a month
  • FDIC Insured up to $250,000 (temporarily increased from $100,000 for deposits until Dec 31, 2009)
  • Standard ACH bank account connection for speedy transfers.
  • “Green” banking policy. The banks motto is “let’s change the world” and all of their banking policies fall in line with that. They send no paper form, receipts or statements whatsoever unless requested for a small fee.


  • Although the online access is available 24/7, customer service via phone is not (8am-6pm EST compared to 8am-8pm for ING).
  • Unable to set up any sub accounts.
  • No bonus or affiliate program, which may attribute to the lack of online mention or reviews.
  • The online interface seems very archaic and unintuitive.
  • Email support is very slow, if a response is given at all. I have used it half a dozen times and have only gotten one response.
  • For the initial deposit, a bank account connection is set up but removed once the deposit goes through. Then a connection must be set up to a bank account a second time to transfer funds in or out.

My personal experience with the whole process of opening the account went fairly smooth. I completed the application, turned in all the documents that were required and got the application approved within a few days. The whole process took about 10 days to get opened and funded. Then I had to go through the whole micro deposits a second time to get my bank account established and be able to transfer more money in or out.

Overall I advise anyone that is looking for a new account to check out ShoreBank Direct but I would not advise anyone already using ING Direct to “chase the interest”. If one is already set up in ING and familiar with the interface, especially someone taking advantage of the ability to create multiple sub account for different purposes, stick with ING Direct.

For anyone that wants a low maintenance account that serves only one purpose, accruing interest, ShoreBank Direct is a great choice. One can even think of the difficulties of the online interface as a positive thing. It is so difficult to use and transfer money out, it may discourage one from ever doing so ūüėČ

UPDATE: 02-23-2009

I wanted to post an update about some of the problems I mentioned with the web interface at ShoreBank Direct. I recently called them about an issue I was having with the interface and not being able to access some of the areas of the account management page. I was told that their system was just recently made compatible with Firefox 3 and that is the reason some of the pages view or authenticate incorrectly. They are now compatible but are still experiencing some bugs with Firefox 3. So if you have any problems with the accounts management page or any of the embedded content on their site, try using Internet Explorer for that portion. Call and report any bugs as well so they can be fixed. I still think their web interface is a con and not being compatible with FF3 is just a crime.

UPDATE: 02-27-09

I wanted to post another update today as one of the reps from ShoreBank Direct actually sent me a personal email about my post and wanted to correct some of the inaccuracies that I gathered from calling customer service at ShoreBank Direct. Here is the email:

“Dear Jesse,
I read the post on your blog about ShoreBank Direct and wanted to say thank you for the honest coverage, and for opening an account with us.
It is important to us that you and your readers have accurate information about issues that are important to you. Along these lines, I wanted to offer clarification on a couple of items in your post:
  • Credit check
    • We¬†run a soft inquiry on Equifax for identity verification purposes only. We do not have access to¬†the applicant’s credit score or credit history, and the soft inquiry does not affect¬†the credit score or appear on¬†the credit history.
    • We have conducted a re-training this week with our customer service reps on this topic to make sure we are giving accurate, consistent answers to this question.
  • Firefox 3
    • Our online banking system has been compatible with Firefox 3 all along, as long as java and javascript are enabled and cookies are allowed (if not all cookies, then at least¬†specifically for our online banking domain and service providers:,, and
    • We recently made Firefox 3 the recommended version of Firefox. The browser settings above are still required.
    • We are also conducting training with our customer service reps on this topic in order to provide better support.
I appreciate that you have shared your experience with others, and I look forward to any further feedback you might have.”

From this experience I have gained a better respect for ShoreBank Direct. They apparently care about there image quite a bit to reach out and contact a tiny little blog author like myself. I believe they want to provide quality information and services to their customers and again give them a thumbs up for anyone looking for a high yield savings account.

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4 People have left comments on this post

» JayNo Gravatar said: { Feb 24, 2009 - 11:02:50 }

I found your review of Shorebank from search result. Do you know if they did a hard credit check for the application?


Jesse MichelsenNo Gravatar Reply:

I just called to verify and they told me they DO do a hard credit check during the application process.
Just in case you have any other questions, their contact info is:

(800) 905-7725
[email protected]

I usually get through to customer service pretty quickly when I call. Just hit zero at the first prompt.

» ScottNo Gravatar said: { Dec 29, 2010 - 01:12:44 }

I’d like to see an update, or a link to another blog where you show factual information about online savings. I have been using ING direct for almost 5 years. My interest rate is very low now, I am seeking alternate forms of investment. I perfer low-risk, medium-yield gains.

Jesse MichelsenNo Gravatar Reply:

Funny thing, I actually am using ING as my primary savings account now as ShoreBank went under after its rate dropped to just above ING’s current rate. This is due for an update, thanks for the prod.

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