No frills ING Direct ponders credit card

NOTE: This article has been edited from a previous version.

ING Direct Canada, the country’s first no-frills bank, is mulling over introducing a credit card, its president and chief executive says.

“Customers are asking about credit cards. It’s something we’re considering,” Peter Aceto said in an interview Wednesday.

It’s another step in the evolution of Canada’s first discount bank. When ING Direct started here 14 years ago, it offered only telephone banking and no-fee savings accounts with a higher interest rate than its big-bank rivals.

Riding high on its catchy motto “Save Your Money,” ING Direct landed 50,000 clients and $600 million in deposits, exceeding its original targets, in its first year.

Today, it’s closing in on the 2-million-customer mark, and has 1,100 employees and about $36 billion in assets.

Its offerings include GICs, mutual funds, mortgages, loans, just like any big bank – but with a no-fee, no-frills approach.

There are still no branches – customers access their funds via telephone, the Internet, and automated banking machines. But there are “cafes” in North York, Montreal, Calgary, Vancouver, and its newest spot at Yonge and Shuter streets, across from the Eaton Centre, which opened Wednesday.

They’re meant to remind customers that ING Direct is still a different kind of bank.

Instead of cashiers, tellers, or vaults, there’s lots of couches and chairs, coffee with 100% of the proceeds going to charity, snacks, and free WiFi. The Yonge Street location offers community meeting rooms upstairs. Customers can visit to talk about a mortgage or a savings account but café staff don’t have access to customer accounts.

Next week, experts from local businesses such as Henry’s Photography, The Sewing Studio, and Curbside Cycle will offer free seminars.

Canada’s banking industry has changed drastically since ING’s debut. As the big banks scrambled to offer their own low-cost options, a raft of new competition came up on the discount side, from rivals such as President’s Choice Financial and Canadian Tire Financial.

Aceto insists the growing competition is not intimidating. “There’s plenty of room for ING Direct and other competitors to bring value to Canadians,” he said.

It recently launched its no-fee chequing account, called Thrive, and about 300 customers per day are signing up, Aceto said.

Later this year, ING Direct will begin offering a home equity line of credit, Aceto said, adding that he still sees “significant growth” ahead.

“We’re still a relatively young business in Canada,” he said. “We’re proud of what we’ve achieved in the last 14 years but we think there’s a lot of opportunity to move forward.”