Last week, ING Group's U.S. unit (note 1) made a splash with two major promotional efforts:

• Sponsored free access to the Wall St Journal online for an entire day (see screenshot below).
  
• Launched a TV advertising campaign, INGyournumber.com, aimed at the retirement market (press release here, view the spots here). Update 18 March: The company ran a full-page ad for the program in today's Wall Street Journal (p. A7)

INGyournumber <ingyournumber.com> is remarkably similar to Wells Fargo's Retire Secure Index that we looked at last week (here). The financial services giant created a special site with a Flash-based tool designed to help you find your "number." That is, the total amount you need to save to provide your desired level of retirement income.

Financial institutions should draft behind these well-funded efforts, and make sure your retirement tools are prominently positioned within your website.

ING Took Over The Wall Street Journal Online last Thursday (13 March)

INGyournumber.com Microsite

Note:

1. These promotional efforts from the main ING group, not ING Direct; although the direct banking arm did receive a small link on the bottom of the screen.

ING Direct, renowned for its many contests that have created strong brand-buzz, is offering customers the chance to win one of five monthly $1,000 prizes. Any user with a new or existing automatic monthly deposit of at least $100 is entered into the sweepstakes. In addition to the monthly prizes, one grand prize winner will take home $30,000. The contest runs for six months, so the total payout is $60,000.

Low-cost incentives to encourage automated savings are a win-win (see note 1). The bank gets a stable flow of deposits to its savings products, and customers end up "paying themselves first" and developing a savings habit. We recently covered WaMu and Wachovia's efforts in this area (here). 

ING Direct Transfer Money area within online banking (logged in)

Same area showing second part of animated banner 

Note:

1. Unfortunately, the sweeps ended up costing me $700, although it went to a good cause. Since I'm a sucker for a contest, and I didn't have an eligible auto-debit, I went to the bank's Transfer Money page to set up a new one. In the process, I noticed that the auto debit for our son's allowance had ceased working in mid-2005 (note 2). We owed him 31 months of allowance plus interest. Ouch. After taxes, the $1k in prize money will just about get me to breakeven.  

2. The allowance transfer originates from another ING Direct account, which was likely out of funds in July 2005, so the transfer was canceled. It's up to the customer to reinstate the transfer, which evidently I never did. 

Last week’s Net.Finance conference entitled Online Innovations in Financial Services Marketing brought thought leaders together in New York to examine trends and breakthroughs in the world of banking.

For me, there was one clear take away: The new social tools that allow people to connect with each other online are ushering in a new economy.

We are moving into a social economy, where collaboration and participation between and among consumers will sway their choices more than marketing messages do. Those companies that enable social participation, add value to people’s lives and create authentic experiences for their customers will lead in this new economy. There were other topics discussed, but this theme kept creeping into the presentations and conversations in a way I had never before encountered. I’m going to narrow in on this one theme, which ran throughout the two days of the conference, and I apologize to those companies and speakers I’m not highlighting here.

Jurie Pieterse – ING Direct
Jurie outlined several of the key ways that ING is handling the power of its marketing and messaging to consumers by opening up its brand to customer participation. It is clear from ING’s early experimentation that it has a brand with strong emotional appeal and resonance. The bank opens the doors to people who engage with the brand to create photos, videos and prose about how their relationship with ING helps them manage their money.

Jurie explained that when they delivered the prizes in their user-generated content contests, which ranged from $1,000 to $15,000, most winners said that they entered the contests more from a sense of fun and participation than for the money. After this initial experimenting, ING will begin to examine the data to determine if these contest entrants are more loyal and profitable than less engaged customers. I would bet my Electric Orange account they are.

Chris Larsen – Prosper
It is fascinating to watch Prosper evolve their model. Chris spoke at length about the importance of social capital to improving its default rates. The idea is that people who have peer pressure built into their borrowing habits will pay back at a better rate than they do to traditional financial institutions.

Prosper has found that people who receive at least one of bid from friends or family have significantly lower default rates than those who only borrow from strangers. By leveraging this social capital, the entire community acts more honestly, even if lending to friends and family is a small part of the overall equation.

Jason Knight – Wesabe
Jason sees Wesabe as a community of interest focused on money. By allowing members to tag their financial transactions and share whatever information they choose with the greater community, they create a collective intelligence I find very exciting. I see them as the long tail of financial advice. People discuss better ways to use their money, from smarter investing habits to buying better cuts of meat. All of this collective intelligence fuels a social economy where people rule their situation by having a much healthier relationship to the way they spend their money.

Shari Storm – Verity Credit Union
Shari oversaw the creation of the first “bank” blog, which Verity started in 2004. She has strong information and advice to other FIs considering jumping into the world of blogging. It is clear that the blog is an excellent way to humanize the company and engage with their community in an honest and transparent way.

Thomas A. Desmond – TradeKing
I was blown away by TradeKing, a company I had not heard of before. Their marriage of social tools inseparable from their trading platform is perhaps the very best example of social media being used strategically by a company that I have seen.

They have baked community aspects into everything that happens on their site, so, if traders opt in to the community, they can learn from each other based on their actual trading results (similar to Zecco.com, below)

Asheesh Advani – Virgin Money
It took me a minute to wrap my head around Virgin Money’s model, but once I got it, I was hooked. Many people who buy houses get side loans from friends and family to make a bigger downpayment. Same with student loans, or with unsecured personal or business loans. Virgin creates a model around this kind of lending, so both sides can take advantage of the tax benefits available via a documented lending relationship. It creates excellent flexibility, because if a borrower needs to skip payments, the lender can adjust the loan accordingly. The loan can always be turned into a gift at a later date. This takes a part of the social economy which was underground and unseen, and brings it above board, recognizing it as an important part of the overall economy.

Gabriel Dalporto – Zecco.com
Zecco and TradeKing's models have many similarities (one exception being that Zecco offers 10 free trades each month). Community features are built right into the tools making it easy to track individual investors within the community. That allows the higher performers to gain a following and for newcomers to learn from the veterans. Like TradeKing, Zecco allows community menbers to see the actual trading results and portfolio holding of members (that have opted in), adding an enormous amount of credibilty to discussions about individual stocks and trading strategies.

Summary
It feels more and more to me that we’re at a turning point. I admit that these innovations are small, just barely bubbling up to the surface. But I believe these examples of companies quietly tapping into unmet needs provide a model of the future.

Anyone working at a financial institution who wants to understand the potential opportunities and threats coming our way should watch these companies and understand their models. If my experience is any indication, the social economy will begin to trickle into your FI's strategies and executive discussions and those who best understand these concepts can help inform, influence and shape the outcome.

William Azaroff is the Interactive Marketing & Channel Manager at Vancity where he develops interactive marketing initiatives, and pioneered ChangeEverything.ca, the groundbreaking change-themed online community. William builds on a decade of experience at digital agencies in Vancouver, Seattle and Los Angeles driving strategy, extending brands to the Web and building relationships for companies in several verticals, including Honda, Disney, Intuit Canada and the Government of BC. He discusses trends and noteworthy achievements in social media at his blog: azaroff.com/blog.

In our annual Christmas/New Years survey of bank websites (note 1), we once again find little use of holiday themes, especially among the very largest. Scrooge would be pleased with the homepages of the top four: Citi, BofA, Wachovia, and Chase which have no holiday images or messages.

Wells Fargo is the only top-5 bank with a holiday message. The bank wishes its customers Happy Holidays (see below) in a top-of-the-page banner rotating with two other messages: a savings promotion that also uses holiday imagery (below) and an investments banner (not shown). 

However, this year there is one top-20 bank fully embracing the holiday spirit. ING Direct homepage (screenshot above, download flash in note 2, below) features a full-screen animation that first strings Happy Holidays across the page followed by the ING Direct orange ball rolling across the screen, bumping into the tree trunk, and dumping a load of snow on top. It's very well done.   

Also, honorable mentions to:

• Fifth Third and its $10,000 holiday sweeps
• Regions Bank, which is running a Toys for Tots banner across the top
• PNC with its annual tongue-in-cheek Christmas Price Index

Additionally, WaMu and Key Bank use winter imagery. And HSBC, US Bank, SunTrust, BB&T and Citizens are all running small banners for prepaid gift cards.

Wells Fargo

Fifth Third

Regions

PNC                                                              WaMu

Key Bank

HSBC                          SunTrust            US Bank

Citizens Bank

BB&T

Note:

1. Websites observed at 9 AM Pacific Time, Dec. 24, from a Seattle IP address.

2. View the ING Direct holiday animation (here)

ING Direct will spend $220 million in cash to buy Sharebuilder, a unique Bellevue, WA-based discount brokerage, with upwards of 2 million accounts across 660,000 customers (see previous coverage here). The deal was first reported in the Seattle PI last week (here) and confirmed yesterday (here).

At an acquisition cost of about $100 per account or $300 per customer, it seems workable at face value. However, both Sharebuilder and ING Direct's core businesses have historically been relatively low margin, so it will take good execution to make the acquisition pay off.

Many (most??) of Sharebuilder's accounts have come through co-branded programs with 40 banks and 140 credit unions including National City Bank and Boeing Employees Credit Union. It's biggest brand name partner is Wells Fargo (see co-branded holiday promotional email from 2002 below), which not coincidentally, is also an investor in the company. It will be interesting to see if the company's financial institution partners will continue to promote Sharebuilder accounts now that it's a division of ING Direct.  

ING Direct has offered a small assortment of mutual funds to its customers for years (product page here), but they have not been widely promoted. With the Sharebuilder product, ING Direct will have another tactic to fend off the fierce online competition for high-rate deposits.  

Update (8 Nov 2007): comScore released interesting traffic data on the two companies today. In Sep 2007, ING Direct had 2.0 million unique users and Sharebuilder had 1.1 million and there was only a small overlap of approximately 100,000 users. So the combined entity would have an estimated 3.0 million uniques. However, most of the overlap represents customers of both companies. comScore data shows that 8.4% of Sharebuilder logins in Sep. also logged in to ING Direct that month. That means 50,000 to 60,000 Sharebuilder customers are already ING Direct customers, meaning the net account pickup is closer to 600,000.  

Wells Fargo/Sharebuilder email from 2002 (received 16 Dec 2002)

Wells Fargo co-branded Sharebuilder new account application (7 Nov 2007):

I was flying to New York Saturday morning when I read the news in The Wall Street Journal that NetBank had gone under, the largest bank failure in 14 years (note 1). While the WSJ headline, NetBank Failure Shows Online Limits, implied that online delivery shared some of the blame, NetBank's downfall was primarily from poorly underwritten loans, both prime and sub-prime, and most of those originations came the old-fashioned way, through face-to-face mortgage broker sales.

Over the years I've been acquainted with a number of NetBank employees and have written extensively about their innovations since their launch in 1996, as the second Internet-only brand. Interestingly, the three major U.S. Internet-only brands launched in 1995, 1996 and 1997 are gone: the first Internet-only bank, Security First Network Bank was sold to Centura (owned by RBC) and Compubank was sold to NetBank. 

But no matter what the reason, a failure of one of the key names in U.S. online banking certainly gives the industry a black eye. My hope is that a forward-thinking bank buys the NetBank brand from the government and relaunches it with much fanfare next year. Sure, there's some negative brand equity this year, but the NetBank name is a classic and shouldn't go to waste (note 2).

ING Direct, which now lays claim to the retail deposits (note 1), has taken over the NetBank hompage for now (see screenshot below):

For more information:

• FDIC info on the closure here
• NetBank timeline from the Atlanta Journal Constitution here
• It takes a failure for a bank to make TechCrunch here
• American Banker's good summary of the failure, complete with quotes from federal regulators, here

Notes:

1. The company was taken over by federal regulators, who will sell off the assets and return all deposits up to the $100,000 insurance limit. About $1.5 billion in retail deposits, and 102,000 customer accounts, have been purchased by ING Direct. The estimated $110 million shortfall will be covered by the deposit-insurance reserves funded by premiums levied to all banks. The failure does not have direct cost to taxpayers.

2. We said the same thing about NextCard in 2001, but no one followed our suggestion. Now the most well-known website and brand of the most prolific advertiser in the late 1990s has been reduced to a link farm collecting rent from Google Adsense.

I received a mailer yesterday at my Seattle home address announcing ING Direct's upcoming launch in Seattle (see scan below). This version at least was sent only to existing ING Direct customers. Note the inside headline with an appropriate local touch, "Seattle's Getting More Bean for its Buck." 

There are not many specifics in the orange self-mailer, other than "You'll soon be seeing us all over the city—from Puget Sound to Lake Washington— spreading the savings message." I'll keep my camera handy to capture big orange visuals as the company arrives on the scene.

So, it doesn't sound as if we're getting a famous ING Cafe (see inset, the newest one in Chicago). However, I do have the opportunity to earn a $10 referral bonus by handing out the two detachable cards that came with the mailer (see note 1). The new account holder also earns a $25 bonus. Customers can sign up through the mail using the card, or go online to a special landing page <ingdirect.com/seattle> (see screenshot below).   

Seattle mailer front

Seattle mailer back

Landing page for Seattle offer <ingdirect.com/seattle>

Note:

1.  On the above scan, you can only see the top portion of one of two identical perforated referral cards designed to be given to family and friends. Sorry, my 8.5 x 14 scanner didn't capture the entire self-mailer.

Last month, we introduced the Financial Services Monthly Performance scorecard produced by Compete. Here's the second installment, summarizing the overall performance of 23 large U.S. financial institutions and lead-generation sites. For more information, including the detailed methodology and companies tracked, refer to that post (here).

The highlights:

• Financial shopping was down or flat in most categories, especially savings accounts; not surprising given the typical tax-time spike in April.
• The main exception to the trend was checking, which grew a phenomenal 31% in May compared to April. 
• The main drivers of checking account growth: Bank of America's promotion of free MyAccess Checking (see coverage here) and, to a lesser extent, Wachovia, whose Google/MSN marketing caused a major spike in traffic
• But it wasn't all rosy in checking accounts: While BofA was experiencing 25% growth in applications, ING Direct went through a typical post-launch downturn with a 50% decline in application volume
• Credit card conversions were up dramatically, with a 5% increase in application volume despite a 6% drop in shoppers, resulting in a 22% conversion ratio (see note 1) 

Note:

1. Compete revised its card applications show in the previous report. The revised number of card applications:
     March 2007: 1.57 million instead of 1.71 million
     April: 1.70 million instead of 1.88 million with 8% growth instead of 9% 

(Originally published at NetBanker.com)

The latest entry in the WAP camp is ING Direct, which recently began delivering Electric Orange checking account data to mobile phones at <ingdirect.com/m>. The "m" may become a trendy indicator for WAP sites, although most have put it in front of the URL, e.g., <m.google.com>, <m.yahoo.com>. The idea is to have as few keystrokes as possible without requiring a new URL to be memorized.    

How it Works
I used my new Samsung Blackjack with Windows Mobile to access ING Direct's Mobile Orange and almost made it into my account. The /m URL takes you directly to the login page where ING Direct uses the same two-factor Passmark/RSA-powered login on my Windows Mobile device as it does on a desktop browser.

In my test, I was able to enter my customer number, although it took a while before I realized I had to "double click" on the Enter button. Then I correctly answered the two security questions after several tries, and my personal picture and phrase were displayed. But I could go no further. ING Direct would not accept my PIN, which worked fine on the desktop moments earlier.

There are several explanations for my problem. It's possible that the bank wouldn't let me in because my desktop session was still active (doubtful). Or ING Direct may have mistakenly kept me out (doubtful). Or it could have been user error (likely). 

Although, I used the correct PIN number, because of the limitations of my Blackjack, it's difficult to know whether you are typing numbers or letters from the keypad since they are asterisked out in the ING Direct input box on screen. I tried it with and without NUM LOCK pressed; then with SHIFT, then with FUNCTION. Anyway, I was locked out after five or six attempts, and now I can't get in from the desktop or mobile. Hopefully, it will automatically reset tomorrow so I can avoid a phone call to customer service.   

Analysis
The reason I bored you with the details of my failed login is that it points out the serious usability issues with mobile banking. Delivering services to tiny screens with tiny keypads that may or may not have dedicated alpha and/or number keys makes the entire experience much less enjoyable. And it will create a new category of support call to customer service. These drawbacks will be fixed in time, but they will be a drag on adoption in the short term. 

For more information on mobile banking, see our full report at Online Banking Report here.

The latest entry in the WAP camp is ING Direct, which recently  began delivering Electric Orange checking account data to mobile phones at <ingdirect.com/m>. The "m" may become a trendy indicator for WAP sites, although most have put it in front of the URL, eg. <m.google.com>, <m.yahoo.com>. The idea is to have as few keystrokes as possible without requiring a new URL to be memorized.    

How it Works
I used my new Samsung Blackjack with Windows Mobile to access ING Direct's Mobile Orange and almost made it in to my account. The /m URL takes you directly to the login page where ING Direct uses the same two-factor Passmark/RSA-powered login on my Windows Mobile device as it does on a desktop browser.

In my test, I was able to successfully enter my customer number, although it took a while before I realized I had to "double click" on the Enter button. Then I correctly answered the two security questions after several tries and my personal picture and phrase were displayed. But I could go no further. ING Direct would not accept my PIN, which worked fine on the desktop moments earlier.

There are several explanations for my problem. It's possible that the bank wouldn't let me in because my desktop session was still active (doubtful). Or ING Direct may have mistakenly kept me out (doubtful). Or it could have been user error (likely). 

Although, I used the correct PIN number, because of the limitations of my Blackjack, it's difficult to know whether you are typing numbers or letters from the keypad since they are asterisked out in the ING Direct input box on screen. I tried it with and without NUM LOCK pressed; then with SHIFT, then with FUNCTION. Anyway, I was locked out after 5 or 6 attempts, and now I can't get in from the desktop or mobile. Hopefully, it will automatically reset tomorrow so I can avoid a phone call to customer service.   

Analysis
The reason I bored you with the details of my failed login is that it points out the serious usability issues with mobile banking. Delivering services to tiny screens with tiny keypads that may or may not have dedicated alpha and/or number keys makes the entire experience much less enjoyable. And it will create a new category of support call to customer service. These drawbacks will be fixed in time, but they will be a drag on adoption in the short term. 

For more information on mobile banking, see our full report at Online Banking Report here.

I just received an email (inset) from ING Direct announcing a 1% cashback promo for its Electric Orange debit card. Not surprisingly, the rebate applies only to signature debit, where interchange fees cover the cost.

Initially I thought it was a permanent feature of the bank's new paperless checking account. But after clicking through to the landing page (see screenshot below), I discovered it's just a two-month promotion, running June 1 through July 31.

Given ING Direct's staunch consumer advocacy positioning, I am a little surprised it is not a bit more upfront about the two-month time period. Perhaps it's just an oversight, or maybe they are testing different copy treatments.

The 1% offer is also shown on the bank's main Electric Orange product page (here). Again, there is no mention that it's a promotion until you click through the "1% cashback" banner.

Analysis
Overall, it's a good promotion. A clear benefit for the customer and limited duration for the bank. And it helps build awareness that ING Direct supports debit card use at the point of sale, a relatively new feature for the direct bank. See previous coverage here.

Landing page (here)

The FDIC database has been updated with Q4 numbers, allowing all the data miners to slap on their hard hats and get to work. Since reporting on the tepid third quarter of ING Direct (U.S.) (here), we've been looking forward to the year-end data.

The biggest surprise is that the bank not only reversed the Q3 account run-off, it managed to add 220,000 new accounts, its best fourth quarter ever. However, things weren't so rosy in terms of deposit balances, which increased just $800 million, the lowest Q4 increase since 2001 when the bank had less than $3 billion in total deposits.

For the full year, ING added $7.2 billion in deposit for an 18% increase, the first time the bank had less than 40% year-over-year growth. And almost the entire increase came in first quarter. The bank essentially had no deposit growth in the final nine months of the year (see table below).  

It will be interesting to see what impact its new high-rate Electric Orange checking account will have on deposit and account growth. The account was growing rapidly during the final stretch of the invitation-only launch period, growing from $1 billion on deposit Dec. 31, to $2.2 billion by mid-February (see coverage here).

Second Life, the alternate reality with four million members worldwide, has a surprising driver, capitalism. According to Second Life Insider, US$1.5 million changed hands yesterday (link here). And if there's money changing hands, there are opportunities for banks and financial scammers (not necessarily in that order).

In a March 6 search, Second Life Insider found ten banks operating in Second Life (SL) (post here). Several operate only in Second Life, raising numerous questions about the legitimacy of these non-regulated entities. 

But what most interests us are the six real-world banks that have set up shop in Second Life such as ING's Virtual Holland (see inset above and screenshot below).

Here's a banks in Second Life timeline:

Sep. 2005: Wells Fargo is the first real-world bank with a presence in Second Life (SL)
Dec. 2005: Wells Fargo leaves SL, moving its Stagecoach Island to a new platform (see previous coverage here)
7 Dec 2006: ABN Amro becomes first European bank in SL (press release here)
7 Jan 2007: BNP Paribas opens a small test area (post here)
7 Feb 2007: Swiss bank BCV opens its doors in SL (press release here)
21 Feb 2007: ING Bank launches website and blog to get users involved in building what it calls Our Virtual Holland <ourvirtualholland.nl>
2 Mar 2007: Danish Saxo Bank announces plans to create trading platform in SL (Reuters article here)

Analysis
It's hard to predict whether banking will ultimately become a transactional business in Second Life or other virtual realities (note 1). However, with four million registered users and an inordinate amount of press attention, leveraging a Second Life presence for marketing purposes looks to be a winner.

But if you are going into SL, make sure you mirror the effort with a Web presence that lets the other 1 billion Internet users see what you are up to. And there is no one doing that better than ING, who's taken a Zen approach to its SL strategy. They've made the process of building a SL presence more important than the actual result. Their Web 2.0-inspired website ourvirtualholland.nl involves the community with blogs, suggestions, and an email list (see screenshot below).

Note

1. For the record, we believe that full banking capabilities, including transactions, lending, currency exchange, will eventually be conducted in virtual communities such as Second Life. Whether it will ever be more than just a niche play, is unknown.

I don't know how I missed this yesterday. The Bank Deals blog, which routinely gets this stuff first, was the first to note that ING Direct's much-discussed new paperless checking account is now visible on its website (see below). The full launch follows a 4-month invitation-only period (see our previous coverage here).

However, the account is not currently running on the homepage, which tonight was rotating through three product offers:

• 4.5% Orange Savings
• 6.0% Orange Mortgage
• Orange retirement accounts: Traditional and Roth IRAs  

ING Direct, along with Everbank, are currently running ads on Google for "electric orange" and "electric orange ING Direct" (see inset). The landing page, shown below, includes a Jane Kim Wall Street Journal clipping.  Interestingly, the ING Direct landing page still says you must first open a savings account to qualify for the checking account. The Website carries no such restriction.   

We'll have more info on the account as we run it through its paces.

ING Direct product page

ING Direct landing page from Google AdWords ad

According to eCheck.org, the "modern" check dates back to the early 1500s; that is, if you don't count chiseled IOUs from the Roman era 2,000 years earlier (see history here).

Five-hundred years ago, I'm sure a "user customizable" piece of paper you could trade for a goat was an exciting new way to pay for something. But there hasn't been a whole lot of innovation since then. As a matter of fact, the paper check-writing practice has all but disappeared in most countries.   

That's why it's newsworthy when someone puts a new spin on a five-centuries-old product as ING Direct is attempting with its new Electric Orange (EO) checking, currently in invitation-only trial, but soon to be released to the entire country. And they are having some early success, landing more than 60,000 accounts as we mentioned here, and creating some online buzz as Ron Shevlin points to here at Marketing ROI.  

What are the features of Electric Checking? 

• Cool name
• Great user interface for payments (see screenshots below)
• Same-screen initiation of electric (ACH) or paper payments
• 24-hour payment delivery for $15 fee
• High-payment limits: $100,000 for paper, $25,000 per day on debit card, $5,000 for ACH, and $1,000 per day on ATM withdrawals
• Good branding with the ING Direct no-nonsense design, colors, and copy
• 100% fee-free (other than a few rare items)
• 4% to 5.3% interest depending on balance (see note 1)
• 30-second account setup for existing ING Direct customers
• Easy-to-use website and online access
• No paper checks

Analysis
Electric Orange is an outstanding product, with one major exception which I'll discuss later. The online integration of electronic and paper payments on the same screen makes it intuitive to use and perhaps the best bill-pay suite on the market (see screenshot below). With 32,000 free ATMs, high interest rates, and a MasterCard debit card, this account competes fairly well with old school checking accounts that also come bundled with unlimited free access to 5,000-square-foot human-powered branches. 

But I take issue with the account's most unique feature, "no paper checks" (see note 2). While I understand the marketing advantage of this anti-paper non-benefit, it's actually somewhat limiting for account holders. Instead of not supporting paper at all, why not simply charge a hefty transaction fee for paper checks while keeping electronic items fee-free? Sell me bright orange checks for $5 per 100 and charge a quarter per cleared check. That'll keep the volume down, while allowing customers the convenience of the old-fashioned paper check. And ING Direct gets the "viral marketing" benefit of those bright orange negotiable instruments being literally flown across the country.

I'd be willing to give up preprinted paper checks if a good subsitute were available. Reading earlier descriptions of the account before its introduction, I thought the bank had invented a new in-home process for printing checks, like printing through Quicken but a whole lot easier. Unfortunately, the paper option is good old online bill pay, complete with five-day mailing delays. That won't cut it when you need to pay the lawn guys standing in your front yard with a truck full of toxic liquid (see note 3).  

The last missing piece in EO is electrification of the deposit process. Since the bank opened its doors in late 2000, it's been exceptionally easy to ACH money into the account. That's been one of its key growth drivers. But now that it offers full checking services, the bank should adopt remote deposit capture technology so EO customers could zip paper checks to them over the Net (see USAA's remote deposit service here).

ING Direct Electric Orange main payments screen
Select electric or paper checks

Electric Orange "send paper check" interface
Looks just like a "paper" check, and no need to have the payee set up prior to creating the payment (see next step)

ING Direct "add payee" interface
If the payee in the previous step is new, users simply "address" this virtual envelope to set up the payee; users also have the option of not saving the payee info.

Notes:

1. In online forums and blogs, some confusion has been expressed about what happens within this account when more than six transactions are made in a single statement period. In the account disclosure, ING Direct says that each Electric Orange account is divided into a savings account and checking account, and that the bank will direct deposits into the appropriate account as it deems appropriate, but that after six transactions, all funds will be put into the checking subaccount. However, all monies EARN THE SAME RATE OF INTEREST, so there is no impact on the customer, nor does the customer even see these transfers. It's a technical manipulation that saves ING Direct from having to maintain transaction account reserves on most balances, thereby cutting costs. 

2. Actually ING Direct does offer "remote paper check" initiation via the online bill pay function where users choose from electric or paper checks (see screenshot above). The bank just doesn't allow users to have the paper in their own hands.

3. The bank does offer a quicker ACH payment function, but you need to have access to the bank account number of the recipient, which is not readily available from most people/businesses to whom occasional checks are written. And ACH usually takes 48 to 72 hours to post in the recipient's account, unless they are ING Direct customers.

Yesterday, Money.com posted an article (here) citing new account totals for ING Direct's Electric Money checking account:

• 60,000 accounts, a 1.5% penetration of the
  bank's 4 million accounts
• $2.2 billion in new deposits, a hefty $37,000
  per account*

Two weeks ago (Feb. 1), the bank said it had attracted 42,000 accounts (see post here).

The inset is an actual Electric Orange MasterCard debit card. 

*An average of $37,001 if you ignore my $100 account