A consultant’s journey | Your friendly neighbourhood Spiderman? Or… (sorry couldn’t choose between villains)

When looking for a solution to a challenge, there are so many variables to consider and so many options to choose from!

We all think we know what’s best in theory but when the dreaded time comes to make a final decision, everything we thought we knew become a pool of blurry/mushed information. To make things worse we realise that people close to us supporting our decision making process are not enough to give us clarity, maybe because they really don’t know enough or maybe because they’re biased (any future decisions affect them directly). It doesn’t really matter why because we still need to make a decision and therefore forced to look elsewhere for answers. Is it time to maybe say hello to our friendly neighbourhood consultant? Or… not?

 

What constitutes a friendly neighbourhood consultant?

From most consultants’ perspective, if you’re reaching out with a specific question you must have thought about it enough to lean towards a certain direction. So what’s wrong with giving a direct answer to your inquiry, discussing pricing that works and giving you what you want? At the end of the day, a consultant needs to make money too and complicating things might not result in cashie cash-cash.

So staying within a comfort zone, spending the least amount of time/cost and getting the most return out of each case is a dream come true and to each their own… If the person placing the inquiry doesn’t ask for more, why would you step up and complicate things?

Hmmm… here’s why – consulting in its core is neither coaching nor decision making. Due to the number of options one can choose for a specific case, consulting is more like an amazing journey of research/evaluation passed the limitations of the consultant’s network (since that’s where the proposed solutions will be derived from). Now if we can agree that this “limitation” presents a valid argument, how can one assume that the right decision was made only because it follows the direction of the one asking? Especially without considering what else could be done and adding value through the collection of more information and proper due diligence?

 

But there’s so many solutions/providers – when do we know it’s enough?

Irrespective of how many people/providers you talk to or how many solutions you note down, at some point your notes will become repetitive and present some very obvious characteristics:

Most solutions you noted down are of the same nature

When you browse through your notes, you will come to realise that the solutions (even though offered by different providers with minor differences) are the same in nature. So by giving them a definition or a name, you basically merge them under a specific category, a targeted solution. Once you realise this repetition, it’s time to take a step back and look into the following two traits.

The solutions complement each other

Although solutions are straight forward on their own, depending on the case’s requirements/limitations, when combined can form a better structure that fixes a short term challenge and at the same time offer a long term advantage that you wouldn’t have seen otherwise. So not having enough options, limits your perspective into what else you might be able to pull off with minor tweaks or combos. Once you have a more complete picture, you’re almost done.

You’re able to identify the white noise (all “quick fix” options that would eventually lead in problems during actual operations)

There are so many cowboys in the crowd, presenting and selling and pitching stuff (some of them quite good at it actually) and if you’re not careful, you might make emotional decisions (rushing to fix your current problem by adding another one). You tend to forget the rationale of narrowing down, eliminating, choosing the lesser of few evils (because no business decision is actually perfect). Talking to a few people about the same issue, many times results in different answers that allow you to read between the lines.

Why do people give different answers, you may ask? Well like we said before, not everyone’s the same. Some will take your project face value and give a direct but still good service to what you want (so you’re limited by your own inquiry), some will take on your project and give temporary solutions to fix your current issue (knowing it’s a short term fix, in many cases with potentially irreparable future damages) and some will look into the overall picture and give side options/recommendations that make sense. In the end what matters is, whoever’s collecting this information (whether yourself or your friendly neighbourhood consultant), to be experienced enough to read between these lines.

 

Understood!  Then what?

Once these three characteristics are in place, the first step is to identify from the bunch which solutions can actually work on the specific case. As we said above, the correct solutions are the same in nature, so even though you noted down 10 solutions, narrowing them down can result in only 2-3 defined options.

Now that you’ve identified the solutions that can actually work, you can start matching the information derived from the providers and begin the process of eliminating the “white noise”. If you carefully collected the information, you should be able to cross reference the questions/answers of different providers and identify question marks (???), future problems within the solutions they offer.

So where one provider pitched a solution as the answer to your prayers, another might have a different opinion on the matter, for his/her own reasons. The more questions/answers and the more providers you approach for the same option, the better the elimination process of this “white noise” will be. You now have a clearer path as to what can actually cause headaches down the line, even though it might fix a short term problem.

Important note: there’s no right or wrong in choosing a short term fix, as long as you are aware that it’s not going to last. What’s wrong is when a provider pitches this quick fix as a permanent solution. At the same time, if the provider is adamant about this solution (you now know otherwise), it tells you something about this provider as well and whether your interests are actually aligned.

Finally, once you’ve specified the solutions and eliminated the “white noise” (and potentially providers), with this research you allowed yourself to think outside the box and go a step further. All that is left is choosing to move ahead with the solution that fixes your current challenge correctly or combining some of the options and target a long term milestone that you didn’t even think of before this process.

 

So is your consultant a friendly neighbourhood Spiderman or a nameless villain?

The best consultants – where applicable – won’t give you direct answers/solutions to your challenges. They will provide options according to their experience and beyond, and collect information based on these options. They will not be afraid to add or even remove options they suggested in the first place as more information comes forward, thoroughly evaluate and narrow everything down. The final output will be an educated, researched process to work with and not wishful thinking or pulling emotional tantrums.

Some people are more knowledgeable than others but we’ve come to realise that no one is an “expert” in anything. We’ve seen a lot of “experts” over the years that opened/closed shops taking with them some of the integrity of the consulting business. Surely you must have crossed path with a few yourself.

Making the right choice is almost never (at least in the years that we’ve been consulting) the answer to the direct question you asked in the beginning. It’s very difficult for a good consultant to take on your project as is, knowing there could be better solutions to your case. Walking with such a partner down the path of deciding the future of your business, is most definitely a win because where everyone else keeps failing with inadequate information, you will always come on top with solid structures, targeted milestones and a stronger base to work with.

Food for thought (mostly for us) – Still not sure if we’re doing the right thing by being business oriented and not money-hungry hyenas like a lot of our peers but let’s face it, a leopard can’t change its spots and these are the cards we’ve been dealt with.

 

What cards are you dealing nowadays and what cards have you been dealt with?

#leopard #LeopardWithSpots #HyenasThatEatMoney #SpidermanSpidermanDoesWhateverASpiderCan

If you found this information useful, you might also like:

Understanding the nature of a Forex IB

Forex White Label – should you go for it?

What is a Tied Agent | Definitions and requirements  

About allFX-Consult:

allFX-Consult is a boutique forex consulting agency, catering to quality rather than quantity. For over a decade, our Directors have been connecting with some of the best individuals/professionals, service providers and brokers the industry has to offer so that we can meet any corporate forex challenge that comes our way.

allFX-Consult always has a counterpart/partner for any corporate structure. Before introductions/connections take place, we thoroughly examine all possibilities.

We’re chosen for being discreet, detail oriented and deadline driven.

Contact us for a private conversation to discuss any forex related topic through the contact form or one of our emails at info@allfx–consult.com, partners@allfx-consult.com. We specialise in training sales teams and forex corporate structures for individuals that want to Start a Forex Brokerage.

 

02
Dec 2019
By adminBusinessComments Off on A consultant’s journey | Your friendly neighbourhood Spiderman? Or… (sorry couldn’t choose between villains)

Forex Affiliate – Should you become one and what are the various programs

 

What is a forex affiliate?

A Forex affiliate, simply put allows a forex broker to use his/her website(s) to advertise, promote or distribute a product/service for a pre-agreed revenue commission scheme.

With the rise of blogs and high traffic websites, affiliate marketing gained huge popularity allowing small enterprises to score big, especially relevant ones that have forex related content like news, signals, trading information and industry service providers.

Especially in the world of forex, where every broker wants a piece of the pie a.k.a. market share, forex brokers are willing to spend thousands of dollars on a single affiliate, if it’s worth it. Each forex affiliate owns a small/big piece of that pie, in different regions of the world, thus rendering the website/affiliate network invaluable to the hungry forex broker willing to get it no matter the cost.

 

Best performing forex affiliate networks

Although any high traffic website owner can become an affiliate, this doesn’t necessarily mean quality leads (relevant leads, converting leads) will travel from the website to the broker’s CRM – usually it’s quite the opposite.

The best performing forex affiliates are ones that provide relevant content to their audience who wants to read or find information and therefore, if you want to succeed and be that invaluable case we talked about, you need to be promoting content relevant to the forex market. That could be broker reviews, market news, in depth analysis and signals, industry information, providing insights that are of value to the forex readers and more.

That being said, readers and online searches today are a lot more aware of what they’re reading and if you’re copying other websites/content or if your reviews are brushing though subjects with no substantiated material, you will most definitely fail before you even begin. If you can get your readers to relate to your content, then sky is the limit.

 

How does an audience relate though? Is the website content enough?

With the popularity of online affiliation and the obvious crazy rewards one can gain from it, there are so many websites offering the same information that it kind of stopped readers from clicking on specific links and becoming converting customers for forex brokers. Reason being that a trader/reader that trusts the content of specific websites, he/she has more than one option bookmarked on the browser and bounces in between.

So putting down the hours, making the effort to collect affiliate links is definitely a way to start, but should you only rely only on that? Most definitely not. Affiliates today are a lot more interactive with their audience, a very necessary added-value action, in order to keep reminding people that “hey, we’re still here, we’re providing very relevant content, please stick with us and all will be well”.

If no interaction takes place, these readers/followers/potential income will be devoured by the options and possibilities the internet bombards them with and you can slowly-slowly say goodbye to your future as a top performing forex affiliate.

 

So how does a forex affiliate website become more “interactive”?

First stop – emails

To begin with there’s the email blasting option. With every visit to your website, you start collecting emails. You can never have enough emails, so the more the merrier.

Be very careful of GDPR regulations though as it can be a huge downside to your operation, if people keep receiving email blasts they did not ask or sign up for.

If the target is to gain an email with each visit, then you need to offer back something of value that the visitor will be willing to exchange an email for. Not much is of value nowadays, free stuff, e-books and unnecessary gadgets are all over the place, so you need to make sure it’s different, it adds value and most importantly it’s needed, so that an uneventful exchange (getting that email) can take place.

Even if you just started and only collected 10 emails, you can start sending weekly your material and important information, to keep those 10 people engaged with your content. From there you just add-on to the list. A mistake many email blasters do is making it all about sales rather than added value content. And what do you know – people opt out of the “it’s ok to email me” conundrum they put themselves in.

 

Videos and live broadcasting

In the past, any image on your website would do… you would just go through images on google, or even buy images from reseller websites and it was enough to make your website look good.

Then came real imaging, people wanting to see more of how your office looks, who’s your team etc a fact that helped a little with the decision making process of them buying your product.

Nowadays though, the stronger ally when it comes to interacting with an audience is live broadcasting and videos. They gained a lot in popularity given the abundance of website options that offer the same content, so what better than adding a voice and a face to the person reviewing or providing content?

It’s raw, it’s unfiltered, it’s mostly real, when people put themselves out there live or through a video and open up for comments – good and bad – and so it makes it hard for anyone to second guess if that website is genuine or not.

Same works in the world of forex affiliate marketing as well, with video reviews and commentary, trading webinars and live broadcasting of relevant information that keep the audience engaged with a specific website. It makes sense and most importantly, it works.

 

Specifics of a forex affiliate program

In order to understand the nature of an affiliate program, we need to see the options a broker normally provides and move on to the payout commission schemes. These options include:

  • Affiliate tracking link that tracks all your activity
  • Login access to a system that you can monitor all your affiliate activity
  • Landing pages, banners, videos, promotional material, e-books
  • Content that you can add to your website/emails relevant to your audience preferences
  • Highly trained and converting Sales team to handle your leads, with no language barriers
  • Fast on-boarding and verification procedures
  • Conversion, retention, customer care to ensure longer revenue stream from your traffic
  • Enough payment methods, so that your audience can deposit/withdraw hassle free

 

Forex affiliate commission plans

CPM – Cost per mille (cost per thousand impressions)

Back in the day, before brokers were aware of their options and also affiliates weren’t really looking into what kind of traffic they sent through, banner placements and display marketing was the way to go. So if you had a high traffic website, all you needed to do is place a banner of a forex broker and display it on a daily basis adjacent to your content.

Every 1,000 impressions (times the banner was displayed) your affiliate account would be topped up with the pre-agreed amount. Combined with the “branding” hype, with marketers selling the idea of giving your forex broker substance through consistent messaging, colours and content, all brokers cared about was getting their message out there, on as many websites as possible and at any cost, in order to increase their chances of getting more leads.

We can see where this went wrong though, with the saturation of the market, the retail prospects decreasing in numbers, trading conditions getting harder in regulated jurisdictions and the consolidation of the forex industry leaving little room for “branding tactics”, deals quickly turned into “higher payouts for definite client acquisition”, period.

 

CPL – Cost per lead

Now this program doesn’t pay as much as the next one (CPA) but it’s also a great option to consider, if brokers are willing to offer it to you. Leads today are funnelled like dirty laundry, with lists being sold and processed so many times, that we lost any respect to who we’re talking/harass on a daily basis.

So for a forex broker to offer this program, you must prove that you have the relevant audience that has high chances of converting otherwise they will quickly switch your program to a CPA model. Your website might send 1,000 leads with no relevance to forex trading, which means extremely low converting and even then, excess work from the sales team and follow ups to turn this low conversion into fruitful active accounts.

There are cases though that, a CPL deal can be struck as part of a CPA program, where the broker will pay for the lead if it passed through complete registration and verification procedures. So even though the lead did not become a depositing active client or trader, the affiliate still gets the amount owed for sending through a qualified lead. Of course as already mentioned, the broker might want to combine this with another model (like the CPA model below) as part of a series of actions (lead, registration, verification, deposit, active trading) that will result in a good profit.

 

CPA – Cost per Acquisition

Although this program offers higher revenues (up to $1,000 in some cases), it’s important to distinguish between a high converting sales team that will manage to increase the potential of your traffic, from one that will use aggressive sales tactics, make false promises of profits or even offer investment advice (when they can’t even recognise the relationship between leverage and margin). This normally results in burned accounts, with you to thank/blame for promoting that broker.

Especially if you are a high traffic website, the return on the decision of which affiliate you partner up with, will depend not only by the size of the broker but also on how they handle backend operations like a good conversion team, fast on-boarding, hassle free trading, efficient deposit and withdrawal functions etc.

Usually CPA payout depends on client depositing and trading an agreed number of standard lots.

 

Revenue Share

With STP (Straight Through Process) brokers gaining momentum and traders demanding a more “clear” relationship with the broker similar to an ECN trading environment, the broker cannot pay a CPA commission that can compete with those large lump sums offered by a market maker.

Also in demand by affiliates, that wish their audience to get the best possible trading experience, instead of a CPA commission, they accept to receive a revenue share based on the earnings the forex broker made from that traffic. This of course translates to a per lot arrangement (usually $5-$10 per lot) for as long as the traffic trades with the broker.

 

Hybrid programs (CPA + Revenue Share)

Competition of course does not leave room for “absolute” programs, and it’s common practice for deals to take the form of a hybrid, combining the benefits of at least two worlds (usually the CPA world and the Revenue Share world).

With this program, the broker accepts to pay the forex affiliate a cost on activating the client (opening an account and the agreed traded number of lots) as well as a percentage on life time revenue derived from the trades.

Again, these deals usually go to high traffic, relevant to the forex market websites that are able to constantly produce and leave the forex broker with a profitable scenario. So even when the broker pays more due to the CPA arrangement and doesn’t make enough profit from trades, the overall traffic the forex affiliate produces allows a “margin for error”.

 

2nd tier programs

Affiliates that refer other forex affiliates are also a common program (like an offline master forex IB that promotes other IBs) with smaller percentages of course but, if a high traffic affiliate deal is struck the overall payout can actually be quite high.

 

Should you become a forex affiliate?

Of course you should and anyone that tells you the opposite doesn’t know right from left. But just by making a decision to go ahead it doesn’t mean you’ll succeed and create a profitable business.

Creating a website that places you in the heart of the forex industry, with updated and relevant content, that gives you a credible and sound voice, a good source that engages returning visitors, all these are time consuming, require the efforts of a foot soldier and the stamina of a marathon runner.

Yes, the payout is great and yes it can be done by anyone but if it’s for everyone… well that’s a story only you can tell by the end of it…

 

If you found this information useful, you might also like:

Understanding the nature of a Forex IB

Forex White Label – should you go for it?

What is a Tied Agent | Definitions and requirements  

About allFX-Consult:

allFX-Consult is a boutique forex consulting agency, catering to quality rather than quantity. For over a decade, our Directors have been connecting with some of the best individuals/professionals, service providers and brokers the industry has to offer so that we can meet any corporate forex challenge that comes our way.

allFX-Consult always has a counterpart/partner for any corporate structure. Before introductions/connections take place, we thoroughly examine all possibilities.

We’re chosen for being discreet, detail oriented and deadline driven.

Contact us for a private conversation to discuss any forex related topic through the contact form or one of our emails at info@allfx–consult.com, partners@allfx-consult.com. We specialise in training sales teams and forex corporate structures for individuals that want to Start a Forex Brokerage.

 

04
Nov 2019
By adminMarketingComments Off on Forex Affiliate – Should you become one and what are the various programs

St Vincent and the Grenadines forex broker

 

 

In November of 2012, the St Vincent and the Grenadines FSA (Financial Services Authority) was established to control the island‘s financial industry, as demand for registrations and company incorporations was increasing drastically. As always, not far behind followed a good number of companies looking into becoming a St Vincent and the Grenadines forex broker.

It’s important to take into consideration, that although the name FSA in most jurisdictions actually means supervision, regulation, fines, reporting, audits etc, in St Vincent and the Grenadines, forex activity still remains unsupervised and for all intends and purposes, unregulated.

By registering a company as a St Vincent and the Grenadines forex broker, by no means does it imply regulation and the FSA itself warns everyone to be cautious of forex trading websites and forex brokers that claim to be “regulated” under their authority.

 

Firstly, to answer the most frequently asked questions we receive:
  • Local office and employees are not a requirement
  • There is no capital requirement since there is no regulation
  • Important – you cannot open a bank account as a forex brokerage (more about this below)

 

So how does someone become a St Vincent and the Grenadines forex broker?

Straight forward process of collecting/submitting documents and incorporating a company. Once everything is done, the broker can proceed with bank arrangements (extremely hard if not impossible), systems and overall operations setup.

The documents required for incorporation are:

  • Notarised copy of Passport
  • Notarised government Utility Bill (water, electricity – no older than 3 months)
  • Bank reference letters for Shareholder(s) and Directors
  • CV of Shareholder(s) and Director(s)
  • Company documents
  • Clean criminal records

Important note: The documents must be in the English language – if they can’t be provided in their original form in English, a notarized English translation must be sent as well.

 

Looking to incorporate a company in St Vincent & the Grenadines? Contact us to look into the details

 

Information on the corporate structure of a St Vincent and the Grenadines forex broker

At least one shareholder and at least one director are required. The company can be up and running with a wide range of types of shares including registered or bearer shares, voting shares, non-voting shares, shares which may have less than 1 vote per share, common shares, preferred shares, limited shares, shares limited by guarantee or redeemable shares, and shares which entitle participation only in certain assets. The company must maintain a registered office and a secretary and there is excellent privacy control with regards to publicising the names of the shareholders and directors. The company can manage the business from anywhere in the world, no annual external audit requirements and this is basically it.

Most cases we come across that look into becoming a St Vincent and the Grenadines forex broker, are Institutional businesses/networks that operate through a forex IB or White Label program, as a pre-step before moving forward into more complex and expensive alternatives. Remember though that to start your own brokerage, requires more than an incorporated company or regulation, like banking, psp’s and solid sales/marketing plans.

 

Why register as a St Vincent and the Grenadines forex broker?

Some key characteristics of a St Vincent and the Grenadines forex broker include but are not limited to the very low costs and fast set up compared to most regulated jurisdictions, no limits on share capital (a company can start with $1), exemptions from corporate taxes, income taxes, capital gains, no annual reports, no limitations with physical offices and employees.

Although all of the above are such great conditions for the forex brokerage, it can mean doomsday and hellish conditions for traders that fall victims to a few, not so straight forward unregulated entities.

That being said, we want to make sure that we balance the scales a little bit. Most review websites that pretend to be a forex trader’s best friend warn caution, run disclaimer campaigns, raise massive red flags about trading with forex brokers registered in offshore jurisdictions. In most cases, only because of the jurisdiction, a broker is instantly labelled as scam.

We need to be careful because there are quite a few brokers that don’t run chop shops but instead use these offshore registrations to reach milestones that will enable them to get licenses in more reputable jurisdictions in the near future. Many of today’s top brokers started the same way. Unregulated, in a sunny tropical location, with no office or employees, but a solid plan that led to growth, offices and licenses in more reputable jurisdictions.

 

Find out which brokers are registered in St Vincent today as well as the country’s latest economic data.

 

Just because an investor has the funds to pay the crazy costs of a reputable jurisdiction, by no means does it imply that he/she does not run a chop shop. No regulation can prevent misbehaviour in its entirety and if you are a serious industry player, you know that’s true. Yes, the regulated “big” brokers get fines, warnings, extra hassle in reporting, massive costs and guidelines to work with but does this stop them from running clandestine dealing rooms and iffy risk management? Anyone who thinks this is the case is up for small, big, explosive hiccups in their forex trading experience.

To summarise this, some of these offshore companies are so small, that you don’t even speak with a sales person. You go direct through the owner or director and the relationships you can establish with them, are far more serious/important than dealing with an employee of a heavily regulated company.

All we’re saying is traders must do their due diligence while being extremely cautious, as not everyone is into forex activities to grow a proper business. Knowing who you’re dealing with is a must before depositing funds. That being said – you never know, these “offshore” invisible brokers might actually surprise you.

 

Time frames to get registered:

For all intends and purposes, with the submission of all documents you can be up and running in less than a month. Cautious reminder though – don’t register a company for forex activities before you look into your banking possibilities. If you already did though and you’re stuck, contact us now to examine what to do next.

 

 

How allFX-Consult can step into this picture:

allFX-Consult is a boutique forex consulting agency, catering to quality rather than quantity. For over a decade, our Directors have been connecting with some of the best individuals/professionals, service providers and brokers the industry has to offer so that we can meet any forex corporate challenge.

Because of this, allFX-Consult always has a counterpart/partner for any corporate structure. Before we make any recommendations, we thoroughly examine all possibilities. We’re chosen for being discreet, detail oriented and deadline driven.

Contact us for a private conversation to discuss your case through the contact form or one of our emails at info@allfx–consult.com, partners@allfx-consult.com.

#forexlicense #offshorelicense #stvincentforexbroker #forexib #whitelabel

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03
Oct 2019
By adminComplianceLeave a comment

Vanuatu Forex License

 

An excellent alternative to set up a brokerage operation, is under a Vanuatu Forex License. Regulated and supervised by the Vanuatu Financial Services Commission (VFSC), the license gained a lot of respect and interest in recent years mainly due to the low operational cost, more lenient requirements and tax incentives.

The Securities Dealer license application can be prepared and submitted by an international company or individual that must be a Director/officer of the company.

Before moving ahead, it is important to note here that Vanuatu along with Iraq have been commended by the Financial Action Task Force (FATF), the international organisation that lists countries with inefficient measures to combat money laundering, for their efforts to ensure that their framework is strong enough and relevant to current AML/CFT requirements. As a result, in June of 2019, Vanuatu was removed from the FATF Grey List.

 

Firstly, to answer the most frequently asked questions we receive regarding a Vanuatu Forex License:
  • Local office (after the amendment act of 2018) is a requirement. The office must maintain software for filing, management and accounting, a business continuity system and server.
  • No capital requirements – instead the law requires brokerages to hold a securities bond of $50,000.

 

So how does someone start the process to obtain a Vanuatu Forex License?

Through a comparatively fast procedure, the company is required to register a Vanuatu company, prepare and submit for evaluation all documents pertaining to its ID and activities (current and past activities), a detailed business plan, an AML manual as well as a corporate bank account.

Find out which brokers are registered in Vanuatu today as well as the country’s latest economic data.

 

In this regard, the documents required are:

  • Notarised copy of Passport
  • Recent notarised government Utility Bill (water, electricity – no older than 3 months)
  • Criminal record
  • CV and reference letters for Shareholder(s) and Directors
  • Bank statement not older than 3 months, confirming the where the funding is coming from
  • A certified copy of Academic qualifications (true copy stamp from the university/college is enough) for Shareholder(s) and Directors

Important note: The documents must be in the English language – if they can’t be provided in their original form in English, a notarised English translation must be sent as well.

 

Looking to obtain a Vanuatu Forex License? Contact us to look into the details

 

Information on the corporate structure requirements of a Vanuatu Forex License

The Shareholder of the company can be a legal person, unlike the minimum of 1 Director (that must be pre-approved by the VFSC) and appointed on the board. The Shareholder(s) and Director(s) must have proper backgrounds and experience and their approval is at the discretion of the regulator. The Shareholder(s) and Directors are not required to be residents of Vanuatu.

The Director(s) must have a minimum of 5 years’ experience (proved by the reference letters needed to accompany the application) and shall reside for 6 months of a calendar year in Vanuatu. There must be an AML officer approved and appointed as well as a procedure in place that specifies the officer’s replacement.

Quick note here, it’s also common practice under MiFID2 where brokers are required to maintain a replacement policy for all the key personnel of the company, to avoid any setbacks in their duties due to resignations/removals.

Recent changes

After announcements on guidelines, changes and updates on the conduct of business of forex brokers (that came into effect on January 1st, 2019), a more clear understanding of reasons for possible application rejection or license revocation is set, minimum professional indemnity insurance for partners, employees and consultants, financial statements are required to be prepared by an independent auditor that is approved by the Commissioner 3 months after the end of the year.

Moreover, the amendment introduces the new classification system that obligates applicants to choose between Class A, B and C Principal’s license, depending on the activities the broker intends to conduct. This classification will further support the VFSC in its supervising duties and control.

Here is the full Amendment Act of 2018

 

Why a Vanuatu Forex License?

Some key characteristics of the Vanuatu Forex License include but are not limited to the very low costs compared to most regulated jurisdictions, the recognition it receives on an international level for its efforts in combating money laundering (important if later the broker will apply for a license with another jurisdiction), the swift adaptation in controlling and supervising uninterrupted relative to the increase in demand for its forex licenses, the favourable tax conditions (no tax on profit or capital gains).

If you have Institutional business as a network and operate through a forex IB or White Label program, jurisdictions like Vanuatu are a great option to start your own brokerage, before moving forward into more complex and expensive alternatives. Unlike working unregulated, Vanuatu will provide comfort to your clients who need a regulated broker to support their trading needs.

 

Time frames to get the license:

Although people/offices will try to convince you that they can get your setup up and running within 4 months (or less), we will refrain from making any promises since it’s in the discretion of the national regulator to approve, ask questions or even reject any application depending on its complexity and structure. Usually our initial internal assessments are enough to identify problems (if any) in the early stages, thus maintaining excellent time frames.

 

 

How allFX-Consult can step into this picture:

allFX-Consult is a boutique forex consulting agency, catering to quality rather than quantity. For over a decade, our Directors have been connecting with some of the best individuals/professionals, service providers and brokers the industry has to offer so that we can meet any forex corporate challenge.

Because of this, allFX-Consult always has a counterpart/partner for any corporate structure. Before we make any recommendations, we thoroughly examine all possibilities. We’re chosen for being discreet, detail oriented and deadline driven.

Contact us for a private conversation to discuss your case through the contact form or one of our emails at info@allfx–consult.com, partners@allfx-consult.com.

#forexlicense #offshorelicense #vanuatuforexlicense #forexib #whitelabel

You might find this interesting

Top EU and Offshore jurisdictions | Including brokers registered there & the country’s economic data 

Comprehensive list of worldwide regulators and supervising bodies

What is a Forex White Label – should you go ahead and get one?

03
Sep 2019
By adminComplianceLeave a comment

Labuan Forex License | Definitions and application requirements

 

The Labuan Forex License gained a lot of respect after the very recent changes in the regulatory regime of more reputable jurisdictions, just like our very own European MiFID ii, which made it inevitable for forex brokers to look into other possibilities to rest their brokerage operations.

Supervised by the Financial Services Authority (Labuan FSA), the arm of the Labuan International Business and Financial Centre (IBFC), a money broking license allows a Forex Broker to operate uninterrupted within a low tax regime, limited restrictions in the corporate structure and a relatively quick setup (relative to the complexity of each case and compared with other jurisdictions).

 

Firstly, to answer the most frequently asked questions we receive regarding a Labuan Forex License:
  • Local office and employees are a requirement
  • The capital requirements of RM500,000 (approx. $125,000) can be used as operating capital

 

So how does someone start the process to obtain a Labuan Forex License?

Same as with most licenses, the process starts by collecting/submitting documents. After receiving conditional approval by the Labuan FSA, the capital requirements as well as the office set up must be arranged.

Find out which brokers are registered in Malaysia today as well as the country’s latest economic data.

 

In this regard, the documents required are more or less the same:

  • Notarised copy of Passport
  • Recent government Utility Bill (water, electricity – no older than 3 months)
  • Reference letters for Shareholder(s) and Directors from a Bank and a CPA
  • Bank statement not older than 3 months, confirming the funds required for the capital requirements (RM 500,000 equivalent to approximately $125,000)
  • A certified copy of Academic qualifications (true copy stamp from the university/college is enough) for Shareholder(s) and Directors

Important note: The documents must be in the English language – if they can’t be provided in their original form in English, a notarized English translation must be sent as well.

 

Looking to obtain a Labuan Forex License? Contact us to look into the details

 

Information on the corporate structure requirements of a Labuan Forex License

The Shareholder of the company can be a legal person, unlike the minimum 2 Directors (that must be pre-approved by the Labuan FSA) and appointed on the board. The 2 Directors must have proper backgrounds and experience and their approval is at the discretion of the regulator. The Shareholder(s) and Directors are not required to be residents of Malaysia. There are also no restrictions to where the board holds its meetings although the minutes must be signed by a resident secretary.

An office with minimum annual expenditure of $20,000 and 2 local employees is mandatory, as well as audited financial statements and the filing of annual and tax returns. A RM 5,000 (approx. $1,500) yearly license renewal fee is due before the 15th of January of the next year.

The Labuan FSA offers a very discreet and private environment for licensed entities, allowing for strict confidentiality and no public disclosures of the beneficial owner’s info.

 

Recent Changes

After announcements on guidelines, changes and updates on the conduct of business of forex brokers (that came into effect on January 1st, 2018), an approval from the authorities of countries intended to do business in, became mandatory. The Labuan FSA will require this before allowing the broker to commence operations. Transactions in the Malaysian Ringgit are prohibited as well as soliciting Malaysian residents. There are margin requirements and leverage restrictions (although not as bad as Europe and US) that are capped depending on the experience of the trader. Segregated client accounts, time frames for client withdrawals, a detailed business plan and compliance with the AML/CFT Act on money laundering issued by the Central Bank of Malaysia (CBM) are part of the mandatory supervised operations.

Link to the guidelines

 

Why a Labuan Forex License?

Some key characteristics of the Labuan Forex License include but are not limited to the very low costs compared to most regulated jurisdictions, the stability of Malaysia’s political environment, its strategic location relative to potential target countries as it shares the same time zone with major Asian countries like China, Hong Kong, parts of Russia & Indonesia, Philippines and also a small 1 hour difference with parts of Russia, Indonesia, Cambodia, Laos, Bangladesh, Japan, South Korea, Thailand, Myanmar, Vietnam.

If you have Institutional business as a network and operate through a forex IB or White Label program, jurisdictions like Malaysia are a great option to start your own brokerage, before moving forward into more complex and expensive alternatives. Unlike working unregulated, a Labuan license will provide comfort to your clients who need a regulated broker to support their trading needs.

 

Time frames to get the license:

Although people/offices will try to convince you that they can get your setup up and running within 4 months (or less), we will refrain from making any promises since it’s in the discretion of the national regulator to approve, ask questions or even reject any application depending on its complexity and structure. Usually our initial internal assessments are enough to identify problems (if any) in the early stages, thus maintaining excellent time frames.

 

 

How allFX-Consult can step into this picture:

allFX-Consult is a boutique forex consulting agency, catering to quality rather than quantity. For over a decade, our Directors have been connecting with some of the best individuals/professionals, service providers and brokers the industry has to offer so that we can meet any forex corporate challenge.

Because of this, allFX-Consult always has a counterpart/partner for any corporate structure. Before we make any recommendations, we thoroughly examine all possibilities. We’re chosen for being discreet, detail oriented and deadline driven.

Contact us for a private conversation to discuss your case through the contact form or one of our emails at info@allfx–consult.com, partners@allfx-consult.com.

#forexlicense #offshorelicense #labuanforexlicense #forexib #whitelabel

You might find this interesting

Top EU and Offshore jurisdictions | Including brokers registered there & the country’s economic data 

Comprehensive list of worldwide regulators and supervising bodies

Understanding the nature of a Forex IB

12
Jun 2019
By adminComplianceLeave a comment

Tied agent | Definitions and registration requirements

 

 

What is a Tied Agent?

A Tied Agent is a person (natural or legal) established in a Member State, who, acting under the full and unconditional responsibility of only one Investment Firm (the “IF”) of a Member State, on whose behalf it acts, promotes investment or/and ancillary services, attracts Clients or prospective Clients, receives and transmits Client orders in respect of investment services or financial instruments, places financial instruments or/and provides advice to Clients or prospective Clients in respect of those financial instruments or services.

 

We are copying below Article 29 of MiFID2 regarding Tied Agents, directly from the ESMA website (link provided below):
  1. Member States shall allow an investment firm to appoint tied agents for the purposes of promoting the services of the investment firm, soliciting business or receiving orders from clients or potential clients and transmitting them, placing financial instruments and providing advice in respect of such financial instruments and services offered by that investment firm.
  2. Member States shall require that where an investment firm decides to appoint a tied agent it remains fully and unconditionally responsible for any action or omission on the part of the tied agent when acting on behalf of the investment firm. Member States shall require the investment firm to ensure that a tied agent discloses the capacity in which he is acting and the investment firm which he is representing when contacting or before dealing with any client or potential client.
  3. Member States may allow, in accordance with Article 16(6), (8) and (9), tied agents registered in their territory to hold money and/or financial instruments of clients on behalf and under the full responsibility of the investment firm for which they are acting within their territory or, in the case of a cross border operation, in the territory of a Member State which allows a tied agent to hold client money.
  4. Member States shall require the investment firms to monitor the activities of their tied agents so as to ensure that they continue to comply with this Directive when acting through tied agents.
  5. Tied agents shall be registered in the public register in the Member State where they are established. ESMA shall publish on its website references or hyperlinks to the public registers established under this Article by the Member States that decide to allow investment firms to appoint tied agents.
  6. Member States shall ensure that tied agents are only admitted to the public register if it has been established that they are of sufficiently good repute and that they possess the appropriate general, commercial and professional knowledge and competence so as to be able to deliver the investment service or ancillary service and to communicate accurately all relevant information regarding the proposed service to the client or potential client.
  7. Member States may decide that, subject to appropriate control, investment firms can verify whether the tied agents which they have appointed are of sufficiently good repute and possess the knowledge and competence referred to in the second subparagraph.
  8. The register shall be updated on a regular basis. It shall be publicly available for consultation.
  9. Member States shall require that investment firms appointing tied agents take adequate measures in order to avoid any negative impact that the activities of the tied agent not covered by the scope of this Directive could have on the activities carried out by the tied agent on behalf of the investment firm.
  10. Member States may allow competent authorities to collaborate with investment firms and credit institutions, their associations and other entities in registering tied agents and in monitoring compliance of tied agents with the requirements of paragraph 3. In particular, tied agents may be registered by an investment firm, credit institution or their associations and other entities under the supervision of the competent authority.
  11. Member States shall require that investment firms appoint only tied agents entered in the public registers referred to in paragraph 3.
  12. Member States may adopt or retain provisions that are more stringent than those set out in this Article or add further requirements for tied agents registered within their jurisdiction.

 

See the complete article directly on the ESMA website.

 

Should you become a tied agent?

To answer this question, like with any evaluation on what to do next or how to get bigger, we need to examine your current standing and if tying your business to a regulated Investment Firm is needed at this stage. Maybe you are a White Label or large forex IB that has prospective business in the EU and needs a “vehicle” to enter legally. Most would think that the only way is through a full license, but maybe you’re not ready to take on such costs and compliance demands. Or maybe you tried to get regulated and found difficulties to be approved or even worse, got rejected and you need to identify plausible and feasible next steps.

 

Do any of the above scenarios describe your current status? Contact us now to look into the details

 

If your business is ready to enter the EU area, no matter the reasoning, becoming a tied agent requires minimal cost, hassle free registration process and it’s a great stepping stone, to evaluate if it’s worth it to go for a full EU license on your own. It will support your reputation, build your brand’s name, give you credibility with PSPs and banking institutions and create history for future use with a regulator (if you decide later to apply for a full license).

 

You need to take into consideration that operating as a Tied Agent under MiFID2, means you are obliged to offer trading conditions as a European regulated broker. The marketing and sales plans, the client protection, the tight trading conditions are only part of the regime, so it would be wise to have a solid plan and a European client base (or a prospective European business) before looking into such a concept. Its important to note that no EU regulated broker will accept to connect/tie their business if it doesn’t make sense – not only compliance wise (to have a clear standing with your operations) but also relative to the income you will produce with them.

 

What is the process to become a Tied Agent?

Firstly you will seek registration with the national regulator to be appointed as a Tied Agent of a specific Investment Firm and be registered in the Register of Tied Agents.

Check out CySEC’s register of Tied Agents here 

 

Some of the details you will provide in this regard will include the following (The complete list of needed documents will be provided on a case by case basis and depending on the status of the company applying to become a Tied Agent):

  • Name of the Tied Agent and/or Trading name(s)
  • Notarised company documents and contact information
  • Your agreement with the Investment Firm with estimated revenues
  • Personal questionnaires and documentation for shareholders, directors and employees of the Tied Agent who will provide Investment Services

 

It’s then in the discretion of the national regulator to ask further questions, documents and clarifications. It’s usually a fast procedure, taking just a few months to finalise but if your operations fit in this scenario, it’s definitely worth taking it into consideration. As a Tied Agent, you will learn a lot about the EU target audience, the EU regulatory framework and if it makes sense to invest and get a full license of your own.

 

What does it cost to apply for a Tied Agent registration?

Firstly you need to find the Investment Firm willing to tie itself with your operations. Not all licensed brokers will want to do this, especially if they don’t have enough information regarding who they are tying with and that this new partnership, will not jeopardise/burn their license.

Looking for an EU licensed broker to tie your operations with? Talk with one of our partners today

 

So it is typical that exchange of information will take place, several calls and meetings before any actual numbers/costs are brought forward and reviewed. When it’s all said and done, the cost for the application to the regulator is quite small and can be handled through our office. From experience, what matters the most is the final arrangement on profit share that depending on the size of the licensed broker, can vary significantly. It would be irresponsible to throw random percentages of profit sharing, because each case is different.

 

Lastly, the Tied agent will need to employ a Head of Reception and Transmission that needs to be a certified professional (in the case of Cyprus, the employee needs to be registered in CySEC’s Public Register of Certified Persons (the “Public Register”) which has a salary cost as well as a small application cost, for the regulator to approve the person.

 

How allFX-Consult can step into this picture:

allFX-Consult has done extensive research on the topic and brokered quite a few deals concerning Tied Agents. In many cases, we recommended alternative solutions/partnerships because as mentioned above, not all cases fit the scenario of a Tied Agent. Some cases were ready for a full license and therefore were handled as such. Some others required simpler structures/partnerships/compromises, used as milestones to reach future long term licensing goals.

Our process is simple – we will examine each case separately and provide realistic recommendations based on our findings. All deals brokered by allFX-Consult, eventually resulted in obtaining a full license (either in Cyprus or abroad) or remained successful partnerships (Tied Agent partnerships or other) that to-date benefit all parties involved.

 

About allFX-Consult:

allFX-Consult is a boutique forex consulting agency, catering to quality rather than quantity. For over a decade, our Directors have been connecting with some of the best individuals/professionals, service providers and brokers the industry has to offer so that we can meet any corporate forex challenge that comes our way.

allFX-Consult always has a counterpart/partner for any corporate structure. Before introductions/connections take place, we thoroughly examine all possibilities.

Contact us for a private conversation to discuss any forex related topic through the contact form or one of our emails at info@allfx–consult.com, partners@allfx-consult.com. We specialise in training sales teams and forex corporate structures for individuals that want to Start a Forex Brokerage.

#tiedagent #forextiedagent #forexlicense #offshorelicense #euforexlicense #forexib #whitelabel

 

Useful links

Check our comprehensive list of worldwide supervising authority bodies (includes all member states of the EU)

What are the application requirements for a CySEC license?

Cyprus Forex Brokers – comprehensive list of CySEC regulated brokers and country stats 

 

 

 

12
May 2019
By adminBusinessLeave a comment

Forex ECN | A walk through the types of brokers

 

What is a Forex ECN?

Straight forward definition, not very different from what you will find online, ECN stands for Electronic Communication Network. Simply put a forex ECN is a type of execution that allows a trader to place orders through the Interbank Market, in a more transparent and direct manner than trading against a single forex broker. As we all know, trading against a single broker can have disastrous results in a trader’s account, with so many of them running clandestine dealing rooms in a dark corner of the world.

That being said, not everyone’s the same – through our Sales Training service, we’ve come to get to know market makers that run amazing backend operations, big enough not to worry about specific accounts but rather decide on a daily basis the strategy they will use to handle their overall volumes. Irrespective of their size though, the term market maker still implies a fully operational dealing room in who’s discretion, trades are being executed with strategies in favour of the mothership.

Before we look deeper into the nature of a forex ECN, ponder this – a broker that attracts traders onto its ECN platform is looking for a “cleaner” relationship, since profits are derived from volumes traded and not money deposited in the trader’s account. True ECN brokers are indeed on the side of the traders, supporting their winning strategies, knowing that it will inevitably increase trading volumes.

 

How does a forex ECN work?

Throughout the years, technological advancements supported the development of systems that helped to facilitate dealing in OTC derivatives such as currency exchange rates. Back in the day, only a handful of companies were able to provide bridges that connected trading platforms with liquidity providers.

The Interbank Market, the market that ECN connects to, consists of Banks and large financial institutions that push their liquidity and volumes of transactions in a manner that allows transparency, anonymity and reliability to each trade that requires its liquidity.

Through a forex ECN trading platform provided by the broker, a trader gains access to deeper liquidity and an execution policy unlike any other. Once an order is placed by a trader, irrespective of buying or selling, the system will provide the best possible (best bid or best ask) price available at that instant.

So the system itself is acting as a dealer, therefore cancelling the manual dealing rooms that are normally handling trader’s quotes in a market making environment. A forex broker that does not operate a dealing room is also referred to as a No Dealing Desk or NDD broker.

 

Technology behind Forex ECN

What’s better than receiving orders in fractions of a second (milliseconds) as if you were placing your order standing (or sitting) with your laptop at the major data centres in New York and/or London?

The Equinix data centres with their fibre optic cables are recognised to be the fastest, most reliable price sources in the world. Low latency connections, lightning fast executions, reliable trading conditions are some of the advantages that NY4 and LD5 provide and it’s the reason that leading true forex ECN brokers use them for connections and advanced price aggregations with major liquidity providers and pools.

 

Trading with a Forex ECN account

All brokers that claim to offer forex ECN accounts should show order information and exchange rates in real time. This includes orders processed as well as the prices offered by banks. It ensures transparency in a world where most forex brokers used to run chop shops in dark corners of the world and profiting from the “not so known” price aggregation and price filling at their discretion.

For scalpers and traders that follow high market volatility, typically due to major fundamental announcements (like the Non-Farm Payrolls report), a forex ECN account is the best option since it basically eliminates price manipulation and the dreaded re-quotes. Re-quotes occur especially during high volatility, where the forex broker rejects a price asked from a trader (claiming the market moved) and provides a re-quote that rarely benefits the trader.

This “no-human intervention” is also what defines an STP (Straight Through Process) broker, that uses no dealing room but instead sends the quotes straight through to liquidity providers or an ECN, and only acts as an intermediary. It might be wise to ask a forex broker that claims to offer an STP model, which liquidity providers are used, in order to have a clear picture of the relationship. If looking into a forex ECN account, the term STP/ECN usually go together since the connection is done by straight through process into an ECN trading environment.

Another term introduced with forex ECN is the Direct Market Access or DMA, which refers to the connection of a trader to “a” market (not necessarily an ECN environment, but trades could also be sent directly to major liquidity providers/market makers) that would essentially fill the price. So it’s important to differentiate DMA with ECN unless specified by the broker and substantiated by the order information/real time exchange rates that normally characterise a forex ECN broker.

 

Spreads in a forex ECN account

A forex ECN account should actually have no spreads marked up by the broker, but instead commissions charged per single transaction (not so much the case nowadays). Since the broker does not benefit from risk management and hedging activities, these commissions serve as compensation for bridging the traders with the Interbank Market. Spreads in a forex ECN account can reach 0 and in extremely rare cases it could even go below 0 (not sure if this even happens anymore, except when ECN was first introduced) – very similar case with the Inverted Spreads (a major recession indicator) where a long term instrument yields less return than a short term instrument, resulting in an inverted scenario. In the past, our Sales Training “borrowed” the term Inverted Spreads to point out to our Sales Reps how real and non-manipulated ECN prices can be.

 

Disclosure

All information included in this article is for informational purposes only – it does not intend to provide advice to anyone to follow or not a specific type of broker or services.

 

You might also find this interesting:

All forex regulators by region

Forex White Label  – Should you go for one?

Understanding the nature of a Forex IB

About allFX-Consult

allFX-Consult is a boutique forex consulting agency, catering to quality rather than quantity. For over a decade, our Directors have been connecting with some of the best individuals/professionals, service providers and brokers the industry has to offer so that we can meet any corporate forex challenge that comes our way.

allFX-Consult always has a counterpart/partner for any corporate structure. Before introductions/connections, we thoroughly examine all possibilities.

We’re chosen for being discreet, detail oriented and deadline driven.

Contact us for a private conversation to discuss any forex related topic through the contact form or one of our emails at info@allfx–consult.com, partners@allfx-consult.com. We specialise in training sales teams and forex corporate structures for individuals that want to Start a Forex Brokerage.

 

25
Apr 2019
By adminBusinessLeave a comment

Seychelles Forex License | Definitions and application requirements

A great offshore forex license option, the Seychelles forex license established itself among one the best to have. With a medium sized capital requirement that can later be used for operations, a corporate bank account coming with the package (unlike registering a company in St Vincent and the Grenadines or Marshall islands), no restrictions in the number of clients you can accept, a good reputation in trader communities (compared to other offshore jurisdictions).

 

Firstly, to answer the most frequently asked questions we receive on a Seychelles Forex License:
  • Local office with at least 1 employee is a requirement
  • The capital requirements are $50,000 and can be used as operating capital

 

How does someone start the process to obtain a Seychelles Forex License?

Same as with most licenses, initially a Seychelles company will need to be incorporated followed by the process of collecting/submitting the necessary documents and finally evaluation and approval/rejection of the license by the regulator. Further questions, documents might be requested throughout the process but with the final approval of the license, the license fees are paid to the regulator and the steps for opening a corporate bank account to deposit the capital requirement can start.

If you have Institutional business as a network and operate through a forex IB or White Label program, jurisdictions like Seychelles are a great option to start your own brokerage, before moving forward into more complex and expensive alternatives. Unlike working unregulated, Seychelles will provide comfort to your clients who need a regulated broker to support their trading needs.

 

Find out which brokers are registered in Seychelles today as well as the country’s latest economic data.

 

In this regard, the documents required are:

  • Notarised copy of Passport
  • Recent notarised government Utility Bill (water, electricity – no older than 3 months)
  • Notarised reference letters for Shareholder(s) and Directors from a Bank and a CPA
  • A certified copy of Academic qualifications (true copy stamp from the university/college is enough) for Shareholder(s) ad Directors
  • Director(s) and Shareholder(s) CV
  • Clean criminal record

Important note: The documents must be in the English language – if they can’t be provided in their original form in English, a notarised English translation must be sent as well.

 

Information on the corporate structure requirements of a Seychelles forex license

There will be a minimum of 2 Directors (that must be pre-approved by the Seychelles FSA) and appointed on the board. The 2 Directors must have proper backgrounds and experience and their approval is at the discretion of the regulator. A compliance office must be appointed that will submit the same documents mentioned above and it can be either a director or an externally appointed person. A local employee will be the point of contact with the regulator and maintain all records. The FSA will visit and make sure the offices are fit for approval. Same as with a Vanuatu forex license, a professional indemnity insurance is required as well as a legal advisor.

Although the application process is straight forward, high demand and increase in number of applications are making it impossible for the regulator to fast process everything. Therefore inevitable bureaucratic delays push the time frames a lot longer (we’ll avoid giving actual examples but in some cases it took an extremely long time), a fact that supports the resale of already approved licenses in hopes to speed up the process.

 

Time frames to get the Seychelles forex license:

People/offices will try to convince you that they can get your setup up and running within 6 months (or less) but we will refrain from making any promises since it’s in the discretion of the national regulator to approve, ask questions or even reject any application depending on its complexity and structure. Usually our initial internal assessments are enough to identify problems (if any) in the early stages, thus maintaining excellent time frames.

 

 

How allFX-Consult can step into this picture:

allFX-Consult is a boutique forex consulting agency, catering to quality rather than quantity. For over a decade, our Directors have been connecting with some of the best individuals/professionals, service providers and brokers the industry has to offer so that we can meet any forex corporate challenge.

Because of this, allFX-Consult always has a counterpart/partner for any corporate structure. Before we make any recommendations, we thoroughly examine all possibilities. We’re chosen for being discreet, detail oriented and deadline driven.

Contact us for a private conversation to discuss your case through the contact form or one of our emails at info@allfx–consult.com, partners@allfx-consult.com.

#forexlicense #offshorelicense #seychellesforexlicense #forexib #whitelabel

You might find this interesting

Top EU and Offshore jurisdictions | Including brokers registered there & the country’s economic data 

Comprehensive list of worldwide regulators and supervising bodies

What is a Forex White Label – should you go ahead and get one?

 

15
Mar 2019
By adminComplianceLeave a comment

Offshore Forex License | Myths, truths and facts that not everyone will share

Tagging Forex IB and Forex White Labels, as well as individuals looking to start a Forex Brokerage.

Throughout the years allFX-Consult has been establishing and supporting Forex brokerages, it’s now more obvious than ever, that the lengths people will go to and the stories they fabricate to close business is more or less equal to the service they will actually deliver. To start a Forex Brokerage with or without an offshore forex license requires compromises and costs you’re most probably unaware of and comes with limitations no one will share in full, until you’re already on-boarded on a service.

A large portion of our client base in 2019, came looking for help in getting out of impossible situations other providers put them in. Frozen funds, blocked accounts, 2+ years waiting for a license that would never come, incorporated companies intended to become forex brokerages rendered useless because of banking problems and so much more…

 

Before we continue, keep this rule of thumb in mind:

“Never go forward with the first choice presented to you. Get second/third opinions and validate the information until you finally converge everything into a feasible next step”

 

Choosing a jurisdiction to rest your forex brokerage operations will play a significant role in what type of business you will attract as well as how far you can go with it, so it’s important to consider the reasons you’re expanding as well as your limitations. From what your target audience will be to what trading conditions each jurisdiction allows, detail your plan before you evaluate the possibilities.

If this plan doesn’t fit in any solutions currently offered in the industry, you can start by compromising certain aspects of it with short term solutions, always keeping in mind the bigger picture and working towards a medium to long term plan. Even if this compromise requires partnering, all of our setups get full autonomy (operate independent from other providers/brokers) within a maximum time frame of 2 years.

“Failing to work within a short term frame that’s part of a larger one, ensures stagnation and lack of growth. In 2-5 years, you will be exactly where you first started…”

 

So who is looking to start a forex brokerage?

The most successful cases we encountered, involved medium to large Forex IBs and White Labels (with consistent monthly deposit volumes between $100K to $1 million), looking to further enhance their operations by setting up their own Institutional structures. We’ve also seen smaller networks that also succeeded to start a forex brokerage with the support of external funding and a solid, down to earth business plan.

Are you a Forex IB or White Label looking for better structures? Discuss your options with professionals today

 

With trading conditions getting tighter in more reputable jurisdictions, offshore forex license alternatives sent everyone into a frenzy, thinking that it’s the solution to all their institutional problems. And in most cases it is… each jurisdiction comes with limitations though and you don’t want to spend 30K-40K on a setup, for them to be revealed. Moreover, just by registering a company (no license) in an offshore jurisdiction does not mean you’re good to go since you will be lacking a very crucial element, the bank account. Banks will not open a bank account for an unlicensed forex brokerage, no matter how hard you try. If you already did though and you’re stack, talk with us to look into your options.

 

To put things in perspective, here are some institutional options (with and without licenses) with their attributes:

 

Belize / Labuan / Cayman Islands / Seychelles / Mauritius / Bahamas / Vanuatu / BVI
  • License: Yes
  • Can be expensive to register and maintain, you will receive quotes from $25k-$50k
  • Time frames to get a license and start: minimum 1 to 2 years mostly due to bureaucratic delays
  • Solid banking structures and PSPs are working uninterrupted
  • Physical office is a requirement, except Belize, Cayman Islands

Capital required:

  • Belize – $500k
  • Malaysia – $125k
  • Bahamas – $120k-$300 depending on license type
  • Cayman Islands $100k
  • Seychelles – $50k
  • Vanuatu – Security bond of $50k
  • Mauritius – $30
  • BVI – No capital requirement. Only proof of minimum 1 million in shareholder’s bank account to back up the company if needed

 

St Vincent and the Grenadines / Marshall Islands (This involves registration not a license)
  • License: No
  • Time frames to register/incorporate: less than a month
  • No banking, no PSPs. People/Payment “specialists” might advise to use a paying agent (in most cases another company within the EU) but as the deposits start piling up you will need a truckload of excuses and finally you will be shut down. Also keep in mind that using a paying agent only transfers the banking problem to your paying agent so essentially you’re back to where you started.
  • Capital required: No capital required
  • Cheap to run but with no working banking structures, what will you do with it? (we have solutions for this but it’s a compromise – make sure to contact us to look into the details)

 

Use another offshore forex license as an umbrella – practically acting as a forex IB but with your own brand
  • You can start immediately, no license required
  • No start-up costs, no capital required
  • Support from the licensed entity on the technical and banking level
  • Since the licensed entity will be responsible for compliance, KYC, client funds and liquidity will pass from them so there’s no real client ownership
  • You will be looking into a Revenue Share type of deal

 

Get a forex White Label using another offshore forex license as an umbrella
  • You can start as soon as the White Label is created, no license required
  • Start-up costs depend on the White Label providers usually between $5K-$12K
  • Monthly costs (technical support) also depend on the providers, no less than $3K
  • The licensed entity will still be responsible for compliance, KYC, client funds and liquidity will pass from them so again, no real client ownership
  • You will be looking into a Revenue Share type of deal

 

Lease an offshore forex license
  • Yes, this is also a possibility although rarely (almost never) offered
  • Expensive to operate (not disclosing amounts here because each case is different)
  • You need to prove you have existing flow of operations above $500K monthly
  • Depending on how you attract business, the only requirement would be not to burn the license so you will be going through stringent evaluation.
  • Could combine this with an agreement of buying into the company with each monthly payment. An expensive but excellent compromise with viable future, if it becomes an option.

 

Purchase an existing offshore forex license
  • Buy all the shares
  • Partner up and buy a shareholding percentage
  • Costs between $100K-$250K

 

From experience, a combination of the above can do wonders and the saying “two birds with one stone” is the most accurate assessment when calculating the next step.

Fact 1: you don’t want to wait until you get an offshore forex license (that is IF you get a license, since central banks of offshore jurisdictions are causing massive delays in authorisations)

Fact 2: you don’t want to be a forex IB for the rest of your life, so you need to get ahead of your own game

 

Looking into what your next steps might look like? Contact us to look into the details

 

When you weigh the cost of operating your own structure Vs sharing revenue Vs not doing either, you will see that it’s all needed but at the correct timing. No need to force one over the other when you can set it up with milestones and basically use it all… every tool in your disposal.

Last but not least, pricing/cost is important but shouldn’t dictate your every move.

Any experienced business owner can relate to the fact that “Complete setups come with higher costs and its normal. Lower costs mean incomplete structures that might (or might not) get the job done”.

 

How allFX-Consult can step into this picture:

Whether the decision is a full license (EU and/or offshore) or connecting with one of our partners, our solutions aim long term.

As our worldwide client base increases, Forex IB and White Label plans emerge that allow institutional networks to work with some of the best professionals the industry has to offer.

  • Newly established forex brokerages with strong finance background and solid funding, offering very flexible terms to support their new ventures.
  • Well established investment firms offering partnerships for tied agents, regional partners and more complex structures.

Alternative to full license – Start a Forex Brokerage by:

Connecting offshore: With clients in Belize, Seychelles, the Caymans, Martial Islands and St. Vincent offering the most flexible IB and White Label solutions.

Connecting in the EU: With clients in 15 out of the 28 member states offering strong partnerships to individuals and corporations with existing client base, looking to connect.

 

allFX-Consult always has a counterpart/partner for any corporate structure. Before we make any recommendations, we thoroughly examine all possibilities.

Contact us for a private conversation to discuss your case through the contact form or one of our emails at info@allfx–consult.com, partners@allfx-consult.com.

#offshoreforexlicense #startaforexbrokerage #ib #forex ib #white label #tied agent #regional partner #licensing

05
Feb 2019
By adminBusinessComments Off on Offshore Forex License | Myths, truths and facts that not everyone will share

Forex White Label | Requirements and options

 

What is a forex White Label?

A full license to purchase your own forex platform is very costly and unless you have the operations to support it, then it is common practice to connect through a forex white label program of another provider (usually a forex broker or a prime broker) and market it as your own, with certain conditions.

This enables you to start your own forex brokerage operations, market your very own forex brand and access banking, technical and technological support for a fraction of the huge cost required to do this on your own.

Important note:  look into your banking structures and any regulatory obstacles before you move ahead with any forex white label deals.

 

Part of what brokers provide with their forex White Label solutions are:

 

  • Trading Platforms, Affiliate Software, CRM and in many cases a website (if the broker thinks it’s worth it)
  • Low one-off cost, with average monthly technical support fees (in most cases you only pay the cost of the platform provider so check if there are any mark-ups on these costs)
  • Access to their pool of instruments (make sure the instruments your clients trade are part of this pool)
  • Access to deep liquidity (in some cases you get access to tier 1 bank liquidity)
  • Market spreads from 0.0 pips (depending on the broker)
  • Enhanced execution of orders (even on large scale although you need to meet monthly volume criteria)
  • Bridge to LP (some offer this free of charge and some not so make sure you look into this)
  • Support with Sales – Training your sales team
  • Competitive revenue plans

Are you looking for all of the above features and more? Talk with one of our partners today

 

Should you go for a forex White Label?

If you are a networker in the forex industry, you most definitely have to give a forex white label, a go! Setting up one’s own structure is where everyone in this industry wishes to end up. We must always push ahead with viable plans, as long as these plans are based on realistic expectations and educated decision making processes.

On the other hand, depending on the development of your operations, maybe a forex White Label is not the immediate answer to your next steps. It most definitely must be in your plans, but maybe after strengthening the core of your business in order to handle the costs and requirements (more on this below). Like always, at allFX-Consult we tend to look into compromises that keep costs low but at the same time promote growth and reach milestones that will eventually lead to a predetermined target.

 

From another article we wrote on obtaining an offshore forex license “Failing to work within a short term frame that’s part of a larger one, ensures stagnation and lack of growth. In 2-5 years, you will be exactly where you first started…”

 

To explain this better, let’s take the case of a large forex IB looking into expanding his/her operations – If the number of new clients introduced and monthly deposits are not constant (or fall lower than average), maybe there are more important issues to fix before adding fixed monthly costs and attempt to operate on a larger scale through a forex White Label.

By examining further and looking into the income funnel, we might identify weaknesses in the online/offline client acquisition, weaknesses in the product offered to the target countries (audience), sales under-performance or language barriers, issues with trading conditions, bad execution from the partner broker, failing reputation of the partner broker, shifts in the trader’s demands for conditions not allowed by the partner broker and much, much more.

So although it’s understandable that every networker in the industry wants to start a forex brokerage, it’s crucial to ask the right questions and receive the right answers (not wishful thinking) prior to going ahead with a new arrangement, like a forex White Label.

Searching for answers on what your next steps should be? Contact us to look into the details 

 

What does a forex White Label cost?

No forex broker will publicise their cost (for the obvious reason of fierce competition) but the pricing ranges between $5k-$12k one-off cost for getting the platform(s), and no less than $3k monthly, for support.

These numbers are not set in stone, because of the large number of providers, the added products they might provide within their solutions and of course the different terms they require prior to partnering up. That being said, side products are also known to be offered like “grey labels” or “soft white labels” that are less demanding than a fully fledged forex White Label so make sure you have a clear understanding before you enter into discussions.

The cost depends a lot on the size of your forex operation as well – it makes sense for a forex broker to charge more on setup if the operations of the white label are small (in order to compensate the trouble). It also makes sense to charge less (or even nothing) if the operations of the white label are big. The forex broker stands to gain a lot more from the monthly operations/volumes of the white label, rather than the setup costs so the product becomes more attractive for the white label looking to gain the most with the least possible cost. In many product setups allFX-Consult was consulting on, we advised our clients (forex brokers) to give a $5k worth of platform for free after assessing the size of the white label’s operation, by adding certain liquidity terms into their forex white label package. And by taking this simple (but costly) step, they would gain smaller/average sized networks of $50k-$100k.

Searching for the correct forex product, saleable to your target audience? Reach out to discuss options

 

A forex White Label by an allFX-Consult partner

Looking into your next steps with an experienced partner like allFX-Consult, ensures that you don’t get caught up in unwanted structures and wasted time trying to identify what to do next. Brokers (and their sales teams – we should know as we trained a great number of them) will push their own agendas and products, irrespective of whether these are good for you or not.

Its the nature of the game – we tend to think we know it all, so we put ourselves in situations that make it difficult to get out of or worse, destroy the prospect of a solid business before it even begins.

Don’t put all your eggs in one basket – look outside the spectrum of your own knowledge and seek the advice of others who stood where you now stand. If a forex White Label doesn’t fit in your current operations, don’t force it. If it does, do it right with a clear entry and exit plan (just like with a good trading position).

How allFX-Consult can step into this picture:

As our worldwide client base increases, Forex IB and White Label plans emerge that allow networkers to work with some of the best professionals the industry has to offer.

  • Newly established forex brokerages with strong finance background and solid funding, offering very flexible terms to support their new ventures.
  • Well established investment firms offering partnerships for tied agents, regional partners and more complex structures.

Start a Forex Brokerage by:

Connecting offshore:

With our clients in Belize, Seychelles, the Caymans, Martial Islands and St. Vincent offering the most flexible IB and White Label solutions.

Connecting in the EU:

With our clients in 15 out of the 28 member states offering strong partnerships to individuals and corporations with existing client base, looking to connect.

allFX-Consult always has a counterpart/partner for any corporate structure. But before we connect anyone or make recommendations, we thoroughly examine all possibilities. We’re chosen for being discreet, detail oriented and deadline driven.

Contact us for a private conversation to discuss your case through the contact form or one of our emails at info@allfx–consult.com, partners@allfx-consult.com.

#startaforexbrokerage #ib #forex ib #whitelabel #forexwhitelabel #tied agent #regional partner #forexlicense #forexoffshorelicense

Further reading

What is a Tied Agent – Information and registration details

Understanding the nature of a Forex IB

Forex jurisdictions – with country stats and registered brokers lists

 

08
Jun 2018
By adminBusinessComments Off on Forex White Label | Requirements and options