The US has a huge consuming culture: everybody always wants a bigger car, expensive clothes and 5 credit cards to go shopping whenever they like to. This often results in financial problems with individuals (next to the mortgage crisis). With the amount of commercials and billboards, people do get into the confrontation with stuff that they can buy (financing is always available). While most people sense that $299 a month for a brand new Porsche is impossible, people from a bad neighborhood will imagine the Porsche on their driveway for only a couple of dollars a month. So they think it's a good deal; however, after 5 years, he notices that the $299 interest was only 2% for the first years, after which the interest increases to 15%. The Porsche has already become a wreck. What to do with the $2250 bill each month? Let's get a loan to pay these bills!
ING Direct entered the US in 2000, after a few successful years in Canada, as a 'simple' bank and it has been very successful keeping things simple. The US especially has a huge potential market because of all the hidden fees and unreliable intermediaries in the banking sector. Quoting the ING Direct CEO: "It is my right in America to own and carry a gun. It is a privilege, however, to have a bank account" (aiming on the difficulties of opening a bank account when you have bad credit history or a low income)
"Basically, it's an evil world out there. Brokers and banks try to sell you products you don't actually need, which leads to individuals with debts they can never pay back. There are enough problems in the world: earthquakes, floods, wars... Why should we add financial problems to this list? We live in the richest country in the world!"
ING Direct US grew to a huge direct bank (with the mission: lead Americans back to savings!), and it also offers checking accounts and mortgages nowadays. ING Direct US is successful because clients get what they need: a simple internet bank without hidden fees or minimums on a savings account. ING Direct US also hates the waiting times at call centers: when you call 1-800 ING Direct, you'll soon be speaking to a real person (answering the phone with "Daniel speaking, how may I help you save your money?")
This is a summary of what I have learned in my first week! In the meantime, the news is all about Britney Spears, the pre-elections, and Britney Spears. I'm still looking for a car & apartment and I'll keep you in touch!
Daniel
Check a few pictures of this week...
Or view a recent ING Direct commercial:
