Decision about starting your own Forex brokerage is not an easy one. Every investor knows there are multiple aspects of running a business that need to be analyzed before launch. Nowadays, in the tech industry – the most crucial decisions to make are those concerning IT. Where will you host your services, who will maintain server, quotes and execution etc? Investors usually decide to partner with a technology provider company offering White Label solutions as it is the safest and most reasonable choice. But how to choose the right one?
In general, there are two paths to follow:
- Buying WL from a well-established Forex broker or
- Choosing an independent fintech provider?
Both having advantages and several disadvantages assigned to them. The major advantage of a well-known forex broker’s solution is that it went through a trial by fire and has a proven record of success on the volatile forex market. On the other hand, it has its limitations like: using only A-Book model, confined Client Office customization and payment processors integration or no individual plugin installation possibility.
Besides, using another broker’s White Label solution is always a little conflict of interest, which may affect our business one way or another. For example leaking your clients database might be a threat as it can be easily accessed by the broker’s sales team. If you ever experienced any problems or you are unable to implement any upgrades to your WL platform, this might be the time to consider moving your business to another provider.
The second option for an investor is to choose an independent technology provider. By default, it eliminates any conflict of interest as both sides have common goal, to make your business successful. You get full support not only establishing your White Label broker platform but also enhancing any settings later, when you already operate. And since those WL platforms are very flexible, you can buy a solution tailored to your needs.
But how to find the right partner among multiple technology providers offering very similar services and conditions to set up a White Label platform? Especially when most of them offer Client Office, PAMM/MAM, multilevel IB and similar range of instruments. However, the devil is in the details, and the differences can be easily noticed in the monthly charges. As broker becomes successful, gain more clients and have substantial daily trading volumes, the fees can get higher, significantly lowering the increase in profit. First of all, many White Label providers charge turnover fees of $10-$15 per million traded, what can turn out to be a large amount of money to be paid at the end of month. Above that, if broker is an STP type, he pays turnover fee of $2-$3 per million traded to a bridge provider (with restricted minimum monthly fee of $1’000). Finally, in A-Book model broker pays additional $10-$15/mln commission to its liquidity provider with a minimum monthly fee varying from $1’000 to $5’000.
To sum up, STP broker (even with no turnover) can be charged from start $2’000 at average and $22-$33/mln in commissions, resulting in significant brokerage’s profitability decrease. To avoid that, you should look for a White Label provider offering fixed monthly fees and fully enjoy your hard-earned success.
By moving your White Label to Match-Trade Technologies you can increase profitability of your transaction flow by eliminating turnover fees. In Match-Trade we do not charge turnover fees neither for A-Book nor B-Book flow in MT4/MT5. Instead, for our services, we charge fixed monthly fee to keep our client’s costs constant and easy to estimate. Additionally, Match-Trade’s partnership with FX-Edge liquidity provider guarantees free connectivity to FX-Edge trading venue via MT4/MT5 Bridge. Meaning that brokers are able to save on bridge’s minimum monthly or turnover fees. Furthermore, Match-Trade’s White Label Clients will not be charged minimum monthly fee for maintaining hedge account at FX-Edge.
We already helped multiple forex brokers growing their income by switching to Match-Trade’s White Label. Our clients saves fees from $3000 to $10000 on monthly. If you’re interested in cost optimization, let us know what are your monthly fees, so we can estimate your possible savings.