ING Direct will pay thousands of superannuation customers $5.4 million in compensation, after the corporate regulator said "no fees" claims in its advertising risked misleading customers.

The Australian Securities and Investments Commission raised concerns with the online bank over advertising that promoted the fact it was not charging fees - even though the products in question paid customers lower interest rates than offered elsewhere by the bank.

ASIC wants to know more about how life insurance is sold on the phone or online. Credit:Jim Rice

ASIC highlighted ING superannuation products that promised "no fees" for the "cash investment option" and "no investment and administration fees" for its "balanced option."

The bank did not make it clear that customers who took up this option would be paid a lower rate of interest than if they had put their money in ING's "savings maximiser," ASIC said.