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Innovators: Incredible Bank Breaks the Direct-Bank Mold

image The ink’s barely dry on the news that ING Group will divest its U.S. bank, ING Direct, within the next 48 months (note 1), when someone else has already launched a direct bank with a distinctive orange theme (note 2):

The new brand: Incredible Bank from River Valley Bank, an 18-branch, $900 million (assets) bank headquartered in Wausau, Wisconsin.


The strategy: Like the original orange bank’s Electric Orange account, Incredible Bank offers a high-yield checking account, currently paying 2%, that’s 100% electronic. No paper checks (note 3), no paper statements. And unlike the hundreds of rewards-checking products, this one comes with no strings attached. The full rate is paid on all balances up to $250,000, then it drops to 1%.

Other account features:

  • Debit card
  • Free online bill pay
  • Unlimited ATM reimbursement
  • Overdrafts are $34 each with max 10 per day
  • Incoming wires are $5 each, outgoing are $20
  • Mobile banking (which is highlighted on the home page, see below and note 4)
  • ACH in/out (coming soon)

I’ve always wondered why, other than ING Direct and Kiwi Bank, only the U.K. direct banks seemed capable of a light-hearted brand positioning online (see update below). While we’ve seen many good social media and microsite efforts using humor, few financial institutions have dared use this approach on their core websites. Leave it to those spirited cheeseheads in Wisconsin to break the mold finally (note 5).

Initially, it’s the 2% rate that will bring cash to Incredible Bank. But longer term, for any direct bank to add value to the parent’s franchise, it must create loyal customers who won’t bolt to the next newcomer offering a 15-basis-point rate advantage. This is a good start for River Valley, but they’ll need a lot more than this bare-bones website to create long-lasting relationships.     

Hat tip: Bank Deals blog.

Update 9 Nov: The Financial Brand’s Jeffry Pilcher reminded me of two good U.S. examples, GMAC’s Ally Bank and (how could I forget?) Redneck Bank.

Incredible Bank homepage (9 Nov 2009)


1. In his Retail Delivery presentation, always one of the highlights of the show for me, Second Curve principal Tom Brown said ING Direct would be an attractive acquisition for any number of deposit-seeking large financial institutions; however, he did not name any.
2. Full disclosure: I have a strange weakness for the color orange, perhaps the result of many trips to Florida as a child. So, take anything I say in this post with a huge grain of salt. 
3. Normally, I think paper checks should still be made available, even if they are discouraged with fees. However, in cases where the direct brand will cannibalize deposits at the parent, it can make strategic sense to cripple the direct brand’s checking account in this way. That way, fewer River Valley customers will simply move their entire checking account over.
4. The bank has created a mobile site with shorter URL:
5. While Incredible Bank is quite different, the main River Valley Bank brand remains typically conservative, at least in its online presence. They don’t even dare mention the Incredible brand anywhere on its website.
6. See our Online Banking Report: Growing Deposits in the Digital Age for a dozen more strategies.