Forex traders see the global currency market as a playground of opportunities. The largest financial market in the world, forex moves around $7.5 quadrillion every single day. Compare that to the next biggest, the stock market, which sees an estimated daily turnover of $200 billion, and you get the picture. Forex is the Everest in the market mountain range: with peaks of volatility and crevices of profit. It should come as no surprise then, that the market for creating forex brokerages is booming.
Benefits of setting up a Forex brokerage
- Lucrative Market: Trading trillions of dollars every day, the forex market is the largest and most liquid financial market in the world. It represents a veritable goldmine of opportunity and profits. Entrepreneurs and investors turn to forex in droves as an opportunity to generate substantial income.
- High Demand: Forex trading has gained popularity among individuals and businesses worldwide. As more people become interested in trading currencies, the demand for forex brokerages increases. Setting up a brokerage allows entrepreneurs to tap into this growing market and cater to the needs of traders.
- Technological Advancements: The advancement of technology has made it easier and more accessible to start a forex brokerage. Online trading platforms, automated systems, and sophisticated trading tools have simplified the process, reducing the barriers to entry for aspiring brokers.
- Lower Costs: Compared to traditional financial institutions, starting a forex brokerage can be relatively cost-effective. The availability of white-label solutions and turnkey platforms allows entrepreneurs to establish their brokerages without the need for extensive infrastructure or significant upfront investment.
- Business Opportunity: Setting up a forex brokerage presents a viable business opportunity. Brokers earn revenue through spreads, commissions, and other trading-related fees. With proper management and a growing client base, a brokerage can generate steady income over time.
Obstacles to setting up a Forex brokerage
The fact that forex trading is such a lucrative industry does not make tapping into the potential easy. Nor does the increasing popularity of forex brokerages make it a straightforward solution for an entrepreneur. Establishing a forex brokerage could be a multimillion-dollar opportunity – and it could also be a million-dollar investment. If you are considering setting up a brokerage, remember that there is more to factor in than the costs alone. No wonder the market is booming for white-label platforms to handle the complex process. Here are some of the challenges to setting up a forex brokerage from scratch:
- Regulatory Compliance: Remember you will need to meet all the legal conditions required when setting up a broker. The forex industry is heavily regulated in many jurisdictions (for fair and transparent trading practices, to protect investors, and to prevent money laundering. Getting your hands on the necessary licenses and ensuring you meet all the regulatory requirements can be complex and time-consuming. Ideally, you will have someone to navigate through the red tape: handling the legal and regulatory side of things to make sure you are operating a legitimate brokerage.
- Capital Requirements: Starting a forex brokerage does not come cheap. In your budget, factor in expenses such as technology infrastructure, platform development, liquidity provision, marketing, and operational costs.
- Technology Infrastructure: We can safely assume that most forex trading is done online. Therefore, a robust and reliable trading platform is essential for a successful forex brokerage. Acquiring a state-of-the-art trading platform that offers stability, security, and efficient trade execution will be a big-ticket expense. Also, to ensure a seamless trading experience, you will need to connect with liquidity providers.
- Market Competition: “Where there is profit, there is competition.” With the revenue potential – more players are entering the forex brokerage industry by the day and the competition is tough. Standing out and attracting clients in such a crowded market can be demanding. You will need a unique value proposition, a powerful marketing team, and competitive trading conditions to stand out from the crowd.
- Risk Management: Managing risk is critical in the forex brokerage business. Investors will need vigorous risk management practices, including monitoring and mitigating market risk, credit risk, and operational risk. Your risk controls and safeguards to protect client funds will be how you build trust and credibility.
- Client Acquisition and Retention: Forget about sitting on your haunches when the brokerage is built – now the hard work begins! Attracting clients to a new forex broker is one thing, retaining them is even harder.
One of the driving forces behind outsourcing your platform to a white-label broker is that it frees up invaluable time to build your brand and acquire a steady flow of clients. Many white-label brands will facilitate this task by incorporating features such as excellent customer service, competitive trading terms, and value-added services – all essential “bait” for hooking clients.
White Label Brokers – what are they?
White-label brokers are companies that offer ready-made trading platforms and infrastructure to individuals or businesses who want to start their own brokerage. Some white-label brokers provide a complete trading solution, including a trading platform, back-office support, risk management systems, and other essential features. Think of them as a “one-stop shop” for setting up a forex broker. As the business owner, you will still be able to customize and brand your broker and put on your own unique stamp.
Sure, you may lose an element of control, but the customization options will vary among white-label brokers. In a nutshell, white-label brokers enable entrepreneurs to enter the financial markets without the need to develop and maintain in-house trading infrastructure. Building the legal and regulatory architecture of a forex broker can be a tedious and time-consuming task, and white-label solutions not only remove this potential headache but ensure that no critical elements are missed when establishing your business. That said, some individuals may prefer to handle all aspects of their business from backend to client acquisition and any legal steps in between.
To recap, let us do a quick summary of the perks and drawbacks of outsourcing to a white-label solution:
Pros of White Label Brokers
Contracting a white-label forex broker could save you time, money, and the mental load involved in building the foundational architecture of a trading platform. Here are some of the reasons people use white labels:
- Ready-made solution: White-label brokers provide a complete trading platform and infrastructure, saving you the time and effort of building everything from scratch.
- Customization: You can brand the platform with your own logo, design, and company identity, giving your brokerage a unique and personalized look.
- Money-saving: Using a white label solution is often more affordable compared to developing and maintaining your own trading platform and systems.
- Time-efficient: With a white label broker you don’t waste any time: you can fast-track your entry into the market and start sourcing clients without any technical delays.
- Support and maintenance: White label brokers usually offer ongoing technical support, updates, and maintenance of the trading platform, allowing you to focus on growing your business.
- Regulatory compliance: The regulatory red tape in forex can be overwhelming. Outsourcing the regulatory and legal framework to a white-label broker could keep you on the right side of the law.
- Access to liquidity: White-label solutions often come with their own established liquidity providers. You will effectively queue-jump any price haggling and access their competitive costs and access to a wide range of financial instruments.
- Risk management tools: White label platforms often include risk management features and tools to help you monitor and control trading risks effectively. As we spoke about above, this will help you protect your traders’ profits and therefore play a vital role in building trust and longevity with your clients.
- Expanded product offering: With a white label solution, you can offer various financial instruments beyond forex, such as stocks, commodities, indices, and more, opening yourself up to new markets and clients.
Cons of White Label Forex Brokers
Notwithstanding the above, dedicating your business to an external organization is not for anyone. Here are some of the reasons:
- Outside control: While white-label solutions offer customization options, you may not have the final say over the underlying technology and features of the trading platform.
- Branding constraints: Although you can add your branding elements, the overall look and feel of the platform may still resemble other brokerages using the same white label provider. This could hinder your attempts to stand out from competitors in the preliminary stages of your business.
- Limited scalability: Depending on the agreement with the white label provider, you may face limitations on the number of clients, trading volumes, or expansion into new markets, which can hinder your growth potential.
- Dependence on third-party providers: Using the white label technology can be positive in the short run, but in the long term you may be frustrated at the restriction of choice when it comes to the technology and infrastructure of your platform. Moreover, you will be pulled up by their success but potentially dragged out by their failure. If the white-label broker sinks, your brand will too.
Prop Trading Turnkey White Label Solutions
The prop trading market currently shows a much stronger development and dynamic than the forex and CFD sectors. Growth and turnover in FX and CFDs are stagnating or declining. Prop trading in connection with securitization is shaping the trading industry. The Funding-Traders industry is massively growing, and the commercial competition within is getting tough and challenging.
In today’s business world, everyone thinks: "How can we add more value than anyone else? How can we make some company young again?". Companies are constantly trying different approaches aiming at the groups’ gathering either offline or online. The twist is traders trade the company’s money. They are starting their own prop-trading firms. With white-label technology a company regardless of its size can now start its own prop-trading firm overnight.
Premium White Label Forex Brokers
As with everything forex, the profit potential is vast, but the competition is stiff. If you are considering using a white-label solution for your forex broker, you may be overwhelmed by the options. To help you sort the cream from the crop, we’ve made a list of the best white-label forex brokers.
Best White Label Forex Brokers (2023)
Here is the thumbnail of our top 6 picks for 2023:
Netrios:
Netrios is a “broker as a service” and “prop as a service” technology provider, that supports Forex and Crypto brokerages. From trading platform, CRM, and payments integration to even providing customer support to end traders, Netrios states that starting a brokerage with it means you don’t have to focus on anything else but user acquisition.
Soft-FX:
Soft-FX is a leading white-label broker. It is a favorite among clients with extremely specific branding requirements, thanks to its comprehensive array of customizable features. Their white-label solution includes a fully equipped trading platform, complete with advanced trading tools, real-time market data, and risk management systems. Soft-FX also offers back-office support, including account management, reporting, and compliance services, freeing up clients to focus on client acquisition and growth.
Interactive Brokers:
Interactive Brokers (IBKR) offers a “turnkey” solution to businesses setting up a forex broker. In other words, clients get instant access to the Interactive Broker’s infrastructure, trading technology, and regulatory framework but within their own branded brokerage. This is a popular white-label solution, renowned for its wide range of financial instruments and market connectivity. Included in the Interactive Brokers packages are back-office support, risk management tools, and customizable reporting capabilities. Another big draw of this broker is its long-standing reputation: Interactive Brokers were founded in … and the industry reputation has built loyalty among their clients.
X Open Hub:
This white-label solution stands out for its advanced technology with real-time market data, straightforward scalability, and long-standing industry expertise. X Open Hub has extensive experience in not only forex but also in CFD trading. The design team at X Open Hub has been highly reviewed for their sensitivity to client needs and evolving efforts to remain competitive and stay ahead of the curve.
Leverate:
The USP of the Leverage white label solution is in the customization options. Leverage recognizes the importance of distinct branding and the need for clients to offer tailor-made solutions to their traders. The level of customization, alongside the scalable infrastructure, makes Leverage stand out from competitors.
B2Broker:
Clients looking for a feature-packed and experienced white-label broker should consider B2Broker. Their all-in-one solution covers everything from trading platforms to liquidation aggregation and ongoing technical updates. The holistic approach offered by B2Broker is highly adaptable, with endless customization options to suit a range of clientele.
Under the hood of Netrios
Netrios – a Red Acre Group company – Is a rapidly growing and innovative technology company in the FX and Crypto trading industry, providing ultra-fast Full White Label turnkey products that add value to partners and end traders. With a strong vision to become a leading provider of cutting-edge solutions, the company aims to revolutionize the trading industry, offering a seamless ecosystem of value that enhances every step of the user journey. With Netrios everything you need will be in one place. Netrios provides its clients with more than just a broker/trading platform, it provides an end-to-end solution to fulfill their business goals. From trading technology, and legalities to branding, marketing, and support you will get everything your business needs here without the headache of looking for different third parties.
Why choose Netrios?
Netrios offers brokerages the ultimate package to build and grow with fully customized, high-tech, premium trading solutions. The solution provides everything a brokerage needs to drive the growth of the business further and faster.
Excellence and innovation are the two central pillars that support its mission to support and fuel the world’s leading Forex and Crypto brokerages.
Pros
- An end-to-end solution: With Netrios everything you need will be in one place. From trading technology, and legalities to branding, marketing, and support you will get everything your business needs here without the headache of looking for different third parties.
- Cost-effective: Netrios can offer you ultra-competitive pricing and great execution on a wide selection of markets.
- Customization: Netrios has a type of process that provides the flexibility of a high degree of customization, a large scope, and a high degree of customer involvement if required.
Cons
- Steep learning curve: Users sometimes find it challenging to quickly grasp and utilize all the functionalities effectively.
Under the hood of Soft-FX
Soft-FX is a fintech company with a global reach in 22 countries. Launched in 2005, Soft-FX started as an IT solutions company supporting trading platforms and brokerages. Over the years they expanded into more software solutions for forex brokers, banks, and other financial hubs. One of their best-selling offers is their industry-leading white-label solution. In 2018, they achieved Microsoft Gold Partner status with 50 certified specialists counted among their employees. For their technological expertise and years of industry experience, Soft-FX is a reliable choice for clients seeking to build a forex broker. Their white-label solution operates through the tandem deployment of two services: the TickTrader trading platform and the TickTrader PAMM, a SaaS web service for clients to manage investors’ funds.
Soft-FX's Forex Broker Turnkey solution includes reliable software, access to deep liquidity, the TickTrader trading platform, and a convenient back office. They claim over 30 technical connectors to major FX liquidity providers and integration with over 60 fiat payment systems. TickTrader is an advanced platform showcasing algorithmic trading, multilingual terminals, and powerful trading orders.
Why choose Soft-FX?
The Soft-FX solution is compatible with a range of businesses. You can offer trading services for various financial instruments, not just Forex, which means you can attract a broader range of clients. The implementation process is quick, taking only 2 weeks. Plus, you can maximize your profits with a hybrid business model that combines A-Booking and B-Booking. TickTraders is a reliable platform for forex. Traders can choose between different accounts for spot operations and margin trading, and run the program across various devices, including the web, Windows, and mobile. The Soft-FX pricing model is both transparent and reasonable, with no hidden costs (an important factor when choosing a white-label solution). They have a pricing calculator where you can tot up the probable cost of the Forex Broker Turnkey solution depending on your add-ons. The setup fee starts from €15,000, and there is a monthly fee of €3,000.
Pros
- Customization: Soft-FX's white label solution provides a high degree of customization. If you have extremely specific brand and design needs or functionality requirements, Soft-FX could tailor your company accordingly.
- Advanced Technology: The platform incorporates cutting-edge technology, offering a range of features such as advanced charting, trading tools, risk management systems, and connectivity to liquidity providers.
- Multi-asset Support: Soft-FX's white label solution supports multiple asset classes, including forex, commodities, indices, and cryptocurrencies, providing brokers with the flexibility to offer a diverse range of trading instruments to their clients.
- Back-Office Tools: The solution includes robust back-office tools for efficient management of client accounts, reporting, and risk monitoring, streamlining the overall brokerage operations.
- Ongoing Support: Soft-FX provides ongoing technical support and regular software updates to ensure the smooth functioning of the white label platform, addressing any potential issues or security vulnerabilities.
Cons
- Cost: The white label solution provided by Soft-FX may involve a higher initial setup and licensing costs compared to some other options in the market.
- Learning Curve: As the platform offers a wide range of features and customization options, there might be a learning curve for brokers and their staff to fully understand and utilize all the functionalities effectively.
- Integration Challenges: Depending on the existing infrastructure and systems of the broker, integrating Soft-FX's white label solution into their operations may require additional efforts and resources.
Under the hood of Interactive Brokers
Interactive Brokers (IBKR) has a white labeling option for Forex brokers. The IBKR goes beyond forex: clients can expand into other markets such as stocks, futures, and options. Interactive Brokers has an impressive global and market reach: with access to 150 markets across 33 countries. IBKR may not offer as many customization features as other white-label solutions, but brokers can add management tools, change the look, and feel of the platform, and even tweak the Trader Workstation (TWS).
Brokers will have the final say over who uses the platform, and fees, and billing is made easy with electronic invoices. With IBKR’s white labeling, brokers can give their clients competitive prices for Forex trading. They do not list the prices for their white-label solution, so brokers need to get in touch with them for the details. The review process takes a couple of weeks, and brokers need to deposit $10,000 to get started, but that money can be used for the first five months of commissions.
Why choose Interactive Brokers?
The TWS platform is already trusted and popular, so when brokers white-label it, their clients get a great trading platform. They can trade over 100 currency pairs, including the big ones like EUR/USD and USD/JPY, plus some lesser-known pairs. The platform also lets traders do options on currency pairs. For a feature-rich forex broker, the IBKR is an excellent choice.
Pros
- Established Reputation: Interactive Brokers has a long-standing and strong presence in the industry. This means by getting behind IBKR you can leverage the trust and credibility associated with their brand.
- Wide Range of Products: Clients can access a range of financial products, including stocks, options, futures, forex, and fixed income. This will help you attract clients down the line with multiple investment options.
- Powerhouse tech: Interactive Brokers offers advanced trading technology with powerful trading platforms, extensive order types, and access to global markets.
- Competitive Pricing: Interactive Brokers is known for its competitive pricing structure, offering low commissions and tight spreads, a boon both for broker and client.
- Regulatory Compliance: As a regulated broker, Interactive Brokers ensures compliance with relevant financial regulations. This will give you the knowledge that you are meeting all the correct regulatory requirements and peace of mind over the protection of your client’s funds.
Cons
- High Entry Requirements: IBKR does not offer their white label solution to anyone: clients must meet certain criteria including minimum capital requirements and specific qualifications. If you have limited resources this may not be the right choice for you.
- Limited Customization: Interactive Brokers have meager customization compared to some other providers. If you are looking for extensive branding to put your stamp on the business this solution may fall short of requirements.
- Technical Complexity: The trading technology provided by Interactive Brokers is advanced, which can be a double-edged sword: a certain level of technical expertise might be needed to take full advantage of the features and integrate the platform into a broker's existing infrastructure. If you are low on technical resources or the time to invest in setup and maintenance, then IBRK is probably not the best white-label forex broker for you.
Under the hood of Leverate
Leverate is a top-notch company that helps Forex brokers and financial institutions with their trading needs. Their LXSuite software is a popular all-in-one fintech solution: packaging together a mobile-friendly trading platform, a CRM system, and other helpful trading tools. For forex brokers looking to kickstart their business, Leverate has a package called "SmartStart." The holistic solution can be used for a Forex/CFD/Crypto brokerage. Many clients choose SmartStart to access Sirix, Leverate's trading platform. Compatible across devices, with copy trading and crypto to boot. Leverate is known for its security-conscious CRM system. One of the best perks of the SmartStart package is that you are appointed a professional success manager to guide you through the entire process of launching and expanding your forex broker.
Why choose Leverate?
Leverate offers ample guidance to new business owners, with the tools, the platform, and the support to make it happen.
Pros
- Comprehensive: SmartStart provides a complete package with all the necessary tools and resources to launch a fully branded Forex/CFD/Crypto brokerage.
- User-friendly: The Sirix trading platform offered by Leverate is accessible on both web and mobile, giving a smooth experience with copy trading and crypto capabilities.
- Attractive branding: Leverate's white label solution includes a fully branded broker website and application with a sleek design to attract and retain clients.
- Dedicated support: Brokers using Leverate's white-label solution receive dedicated support from a professional success manager.
- Customized CRM system: Leverate offers a tailored CRM system specifically designed for brokers and with high-grade security measures in place.
Cons
- Limited customization: Leverate is certainly a reasonably priced and comprehensive solution, it could be said that they drop the ball when it comes to customization options. You can brand your business to a certain degree – but if you’re looking for a unique “look” for your forex broker then you should look beyond Leverate.
- Pricing: The pricing for Leverate's white-label solution is not disclosed and can vary widely. This may be a common feature among white-label brokers, but it is nonetheless frustrating for clients for whom transparency is important.
Under the hood of X Open Hub
X Open Hub is part of XTB SA – one of the largest stock exchange-listed FX brokers in the world. Their umbrella corporation is regulated by some of the best-known authorities, including the Financial Conduct Authority. The X Open Hub white-label solution is a popular choice among brokers, startups, and banks. They have ample experience from the team of IT professionals, and their 100+ industry partnerships bear testament to their services. With X Open Hub, you will build your forex broker using their API.
The trading platform ticks all the right boxes, and their back-office system is particularly flexible: allowing brokers to customize settings and reports to their liking. There is no limit to the number of instruments you can trade, and you can set local time zones for clients. X Open Hub has a generous array of assets on offer, including 60+ currency pairs. In addition to Forex trading, X Open Hub offers deep liquidity on over 5,000 global instruments, including indices, commodities, shares, ETFs, and crypto. The platform is cloud-based, so you don't have to worry about hosting costs, and it is designed for fast and high-quality execution.
They offer ultra-fast feeds and execution through different connectivity options, and you will benefit from low commissions, tight spreads, and deep liquidity on FX trades. They are regulated by multiple authorities to ensure they are looking out for their client's best interests. The XOH Trader platform is sleek and easy to navigate, with advanced charting tools and mobile trading. The xManager back-office system helps you manage clients, set up different trading groups, and monitor trading activity. They even have a mobile app for account management and real-time trading.
Why choose X Open Hub?
Clients looking for a quick and solid solution should check out X Open Hub. They have an express start-up package that will get your Forex broker off the ground in under two weeks! You add on features and get billed accordingly, with packages starting at $1,000 per month. They include consulting services, training, and marketing support. Best of all for first-timers, you will have a dedicated account manager on call 24/7.
Pros
- Experience: X Open Hub has established its reputation with over 12 years in the industry.
- Assets: There is a wide range of trading instruments available, including 60+ currency pairs.
- No hosting fees: X Open Hub has a cloud-based platform with no hosting costs and is designed for fast and high-quality execution.
- Competitive Pricing: Low commissions, tight spreads, and deep liquidity on FX trades.
- User-friendly: The X Open Hub back-office system is an intuitive and efficient tool for managing clients and monitoring trading activity.
- Fast: For clients under time pressure, X Open Hub has an Express start-up package for an accelerated setup.
Cons
- Lack of transparency: The limited pricing information could be masking hidden fees in the white label solution.
- Extra costs: Some additional services, such as consulting and marketing support, may incur extra costs.
Under the hood of B2Broker
B2Broker is certainly a popular choice: they have provided fintech services and white labeling for over 500 customers with a range of custom solutions. The B2Broker white label package is feature-rich, with unique add-ons such as a trader’s room and investment platform. They have their own payment service, “B2Core,” and competitive trading costs. They have 80 currency pairs and offer access to major FX liquidity venues. If you are considering expanding beyond forex down the line, B2Broker extends to more assets including indices, metals, and energies. B2Broker is designed for high-frequency trading with low margin requirements. B2Broker is one of the more transparent brands, with a white label service starting with a $5,000 setup fee and a $2,000 monthly support fee. The exact prices will depend on the niche requirements of the brokerage you have in mind.
Why choose B2Broker?
B2Broker wins on transparency and friendly pricing. They also get brownie points for the extra features such as tutorials, bonuses, and contests. Mere accessories but original and with the potential to emphasize the client-facing feel of your broker to win and retain traders.
Pros
- Beyond forex: With B2Broker, you can extend from forex into additional asset classes like indices, metals, and energies.
- Client-Focused extras: B2Broker provides additional services such as tutorials, bonuses, contests, and investment options like Copy Trading and PAMM/MAM, which can set your brokerage apart from competitors.
- High-Frequency Trading: B2Broker's liquidity solutions are designed for high-frequency trading systems perfect for handling complex trading strategies.
- Cost-effective: B2Broker offers competitive trading costs with spreads starting from almost zero.
Cons
- Setup Fee: The $5,000 set-up fee is a significant upfront cost and one that may fall outside of the budget realm of a new business owner.
- Monthly Support Fee: B2Broker charges a monthly support fee of $2,000, on top of your ongoing expenses.
- Customization Costs: The monthly fees may vary depending on the level of customization – so if you have a long list of branding requirements and innovative ideas to set your forex broker apart from the crowd, be prepared to pay the price
Investors setting up a forex brokerage should be prepared to invest considerable time, effort, and resources into the process. One of the intangible benefits of white labeling is coming under the wing of an experienced industry partner. A white label broker will ensure thorough planning, knowledge, and experience of years in the sector, and a strong business strategy to navigate the challenges in setting up a business. Bear in mind that forex is both a lucrative and competitive field. Investing in market research, regulatory compliance, potent technology, and excellent customer service for your traders will increase your chances of success.
