Introducing Broker and White Label: What’s the Difference?

Vrijeme čitanja:4 min, 17 sec

Let’s move on to the concepts of “White Label” and “Introducing Broker”. Immediately, we note that both are a certain type of partnership with a prime broker. But, if this partnership is offered by a broker or dealing center, you should understand that this particular company will be your prime broker. In the futures market, a Futures Commission Merchant (FCM) acts as a prime broker. In comparison to building your platform from scratch, a quick start with a white label model can save your new business a lot of time and money.

IBs will generally earn rebates – a share of the commission or the spread the brokers charge the client.
Ultimately, the decision of which brokerage model to select lies in factors such as initial capital investment, risk management, and vision.
Obviously, the price of opening a full white label brokerage would be higher than an IB, and the procedure would require greater time and effort.
They provide their clients with trading education and support, as well as access to the financial markets.
They’re like stepping stones that lead to greater opportunities and bigger achievements down the road.
The goal is to introduce the broker’s services to new clients, and IBs are compensated for each new client they bring in.

In fact, a White Label Brokerage firm is a small forex broking firm itself. It has its own risks, customers, support functions and outreach campaigns, except for one thing, they need access to the primary https://www.xcritical.com/ forex broker’s server and back-office support to carry out trading activities. Also, the White Label Brokerage firms make their profits as per the trading volume they obtain from their traders.

Introducing Brokers vs White Label. What are the Differences?

We’ll explain what these accounts are and why this trend is here to stay. This material does not contain and should not be construed as containing investment advice, investment recommendations, an offer of or solicitation for any transactions in financial instruments. Before making any investment decisions, you should seek advice from independent financial advisors to ensure you understand the risks. It depicts a transparent https://www.xcritical.com/blog/white-label-broker-in-forex-what-is-it-and-how-to-start/ system of cooperation between a broker and a third party whose aim is to bring new clients and get rewards for their actions (deposits, lots traded, and so on). Furthermore, White Label programs are characterized by more flexible revenues and commissions, making it possible to establish different partnership levels. Brokers using WL connections don’t need to run their own trading servers and hire experts to maintain them.

White Label broker vs introducing broker program

The White Label Brokerage can independently manage their relationship with the traders. The IBs earns as per the referrals they have forwarded to the broking firm and they get a reward for each successful referral as per the pre-decided terms. At the same time, the WLBs earn as per the magnitude of trading the traders do through their firm, the primary brokers do not have a say in that matter, which increases the potential earnings manifold. A White Label brokerage is a complete operational setup with its own risk management, PSPs, customer support, etc.

Why Are Introducing Brokers Different From White Labels?

There are various functions to each one and the differences between them can be indiscernible at first, but they are there. In this scenario, the firm still acquires a trading platform and other essential services from a provider. But it doesn’t have the same rebranding capabilities as an entirely white label. Such a solution is a less costly alternative and a stepping-stone to a complete model.

White Label broker vs introducing broker program

They can structure and configure their end customer offering and experience in any way they want, thus removing all of the limitations of a white label offering. Overall, the IA builds very little business value through a white label setup and only gains a limited revenue stream. Besides, White Labelling is a more complicated system, as WLs basically provide brokerage services on their own as a stand-alone brand.

What is an Introducing Broker (IB)?

EnclaveFX has established itself as a leading provider of White Label solutions, catering to financial institutions, brokers, and other entities worldwide. Contact us today to discuss how EnclaveFX can help you achieve your goals. Let’s create a winning partnership that drives growth and sets new standards in the financial industry. In reality, becoming an IB is a simpler and more hassle-free way to start earning commissions and delivering traffic to the main broker. As an introducing broker, you do not have to deal with technical issues or account management.

White Label broker vs introducing broker program

Factors like company size, track record, market performance, and others will come into play when building a white label affiliate business. The white label broker also does not facilitate trading orders – all execution is made by the primary broker. But other than that, white label brands function like any other broker, and they call the shots regarding their trading conditions, spreads and commissions, and business structure.