Now that the former ING Direct has completed its change from Dutch online banking pioneer, to a platform controlled by Scotiabank, we figured that we should take a look and see what – if anything – has changed.  We’ll keep updating this thread as the “Tangerine” brand starts to evolve over 2014, so make sure and keep checking back for updated comparisons to some of the other online options out there.

ING Direct and their main competitor – Ally – were two fashionable choices for financially-conscious Canadians a couple of years ago.  These online banks were able to give great rates on high-interest savings accounts, term deposits, and even mortgages.  The idea was to cut retail costs to the bone by using an online model (bricks and mortar storefronts in prime locations aren’t cheap) and then pass those savings on to customers.

Related: The Death of Low-Fee Internet Banking?

Canadians were immediately attracted to the authoritative/vaguely foreign voice encouraging them to, “Save your Money”.  Since 1997 the bank behind the orange website was able to attract almost two million clients.

One Small Step for a Huge Bank, One Huge Loss for Consumers?

tangerineIf you’re like me, you were sad to see ING bought out by one of Canada’s major banking hegemons.  My skepticism comes from seeing what RBC did to Ally once it bought the former online powerhouse (basically just burned it down after lowering rates in order to synchronize with RBC’s offerings) and the incentives that Scotiabank has to do something similar.  That being said, Scotiabank has been very clear is stating that “Tangerine” will be a stand-alone brand and that it has no plans to shut anything down.  The CEO of ING Direct, Peter Aceto stated:

“I want to be clear, what we are sharing with you today, is a new name and a new logo. That’s it.Nothing has changed about our core values and what we stand for. We’re keeping everything you love about ING DIRECT. Great interest rates. No fees, and award-winning customer service.”

I really hope this is the case.  I can tell you this much.  Right after signing on the dotted line (for $3.13 billion) Scotiabank immediately shut down residential mortgage broker operations.  While clients can still get a mortgage through the soon-to-be Tangerine, the online bank will no longer aggressively compete for mortgages through mortgage brokers as was the previous norm.  This is a major loss for anyone with a mortgage, since ING was able to bring a significant amount of competition to a Canadian market that often lacks for true competition.  This is supposed to be the only major change that I can see.

It’s an Apples to Oranges Tangerine Comparison

Hopefully they still keep that Dutch dude on as the spokesperson – I kinda liked him.  Gave the whole orange thing a classy feel.  I’m not sure if the company is trying to play off of the whole, “Apple is really popular with young people right now” angle with the Tangerine name, but frankly, I don’t really care what they call it as long as they keep offering great rates and competition in the market.

Related: Why People Still Don’t Trust Online Banking – And What They Are Missing Out On

The guys from Scotia did say that there would be two major initiatives involved with the rollout of Tangerine in 2014:

1) Access to the Bank of Nova Scotia’s ATM network across Canada.

2) A no-fee credit card for Tangerine clients.

Of the two, I consider the first one to be of much more importance to existing ING customers.  There is no doubt that going from almost no ATM presence of any kind, to being able to stop in at over 3,500 machines across Canada, and another 4,500 or so around the rest of the world is a really nice additional feature.  The credit card won’t make much difference to me as I’m quite certain there will be better options out there.

Initial quarterly earnings were bolstered by the deal, as Scotiabank’s Canadian operations made a 13% leap to $590 million for the quarter that finished in November.

Is Tangerine Worth It?

If you are looking to maximize your high-interest savings account options, it may be worth checking out the less well-known options on the Canadian market such as People Trust, Canadian Direct Financial, AcceleRate Financial, Outlook Financial, Achieva Financial, Canadian Tire Financial, Implicitly Financial, and Hubert Financial.  Most of these are credit unions and subsequently are not likely to get bought out by a major banking arm any time soon.

Stay tuned to see if, “We have no plans to make changes” is actually banker-speak for: “We’re just biding our time before we subtly start to shift customers over to our higher-profit-margin model.”