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
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.
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.
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:
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.
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