In the Forex trading market, White Label Forex company is a corporation that is able to market another broker’s platform as if it was their own. A company can become White Label on grounds of a special agreement made with a broker. This is a great option for those who want to set up their own Forex broker and establish their brand in the market without the need to actually create a new Forex broker. A White Label is in most cases provided with the whole solution which includes trading platform, back-office support, and even allows the company to have its own brand.
White Labels function in a similar way to the regular Forex brokers as they earn from the trading volume of their clients. From the White Label’s point of view, it can be said that it is a lot cheaper way to launch a Forex trading business because the provider can help them in numerous different aspects. This includes providing the latest technology, legal aspects, even building a website as well as different types of marketing programs.
Trading with White Label Forex brokers is not that different from trading with regular Forex brokers. In today’s guide, we are going to talk about all the important aspects of White Label brokers.
As we have already noted, White Label brokers are companies that offer traders access to a trading platform from a regular broker. A White Label is only to offer access to a certain trading platform only with special permission from a regular Forex broker.
So, let’s say that there is a company that wants to offer people trading services, however, establishing a whole new Forex broker is not something that they want to do. There might be different reasons for this. Creating a whole new Forex broker can be a very challenging venture as there are many things that brokers have to consider.
This includes marketing, the legal side of registering as a broker, or taking care of the technological side of the actual trading. To avoid all these processes, some of the companies prefer to become White Label. This gives them the ability to do business depending solely on the services of the broker they made an agreement with. Simply put, it makes everything easier for the business.
In addition, there are other benefits that the White Label companies enjoy as well. This includes a quick launch of the online brokerage firm, regular support avoiding the costs associated with setup and running an actual Forex broker, which requires a special license, and many other things.
White Labels are completely operational companies, that have their own risk management, customer support team, and so on. There are numerous forms that an agreement of a White Label can have. For example, a White Label can come in a simple leasing form, or become a complete entity with its own brand.
As for the traders using the White Label companies, it should be noted that not that much changes. Trading with a White Label Forex broker is pretty much the same as trading with a regular Forex broker. These companies offer traders all the things that the platform it uses has to offer.
Starting a broker with a White Label solution is the best-suited solution for those who have little to no experience in the field but want to become a successful Forex broker and create their own brands in the industry. Forex White Label providers make it possible for companies to offer retail traders services a lot easier than they would be able to if they started their own business from the scratch.
According to the official definition of White Labeling from the National Futures Association of the United States, in most cases, the lessee’s customers do not have to have any type of relationship with the firm that operates the platform. In fact, in some cases, some are not even aware that the broker they are using is White Label.
Simply put, if you are someone who wants to start a Forex brokerage business without all the challenges that might come with the establishment of a new Forex broker, white labeling might be a great option for you. Thanks to the White Label Forex platform, companies have the ability to start brokerage without having to either buy their own trading platform or develop it on their own.
Although there are many advantages that White Labels have, there also are some things that people should keep in mind. So, let’s discuss the major advantages and disadvantages of White Lable Forex brokers.
Generally, these companies can be divided into three main categories. One is co-branding, which means that the companies receive a special domain and the logo from the partners. The second one is called partial White Label Forex broker, which means that the company receives a distinct domain, a fully designed website, as well as a trading platform.
There also is a full White Label Forex broker types, which receive their own website, trading platform, including a whole new icon, additional languages if required, and special customer phone support, and complete technical assistance. However, keep in mind that depending on the Forex White Labeling company, all of these options might not be available.
To put it simply, when it comes to a full white labeling Forex solution partnership, you get the platform and you can brand it any way you see fit. In addition, you are also able to accept deposits from your traders, white partial white labeling mostly means that the deposits from the traders are mostly handled by the primary broker.
Although you might not know, there are many top-tier, well-known Forex brokers around the world that initially started as white labels, and after some time and exposure, were able to become successful, independent Forex brokers. White labeling can also be viewed as a type of affiliate program, according to which, the developer of technical equipment, such as software, for example, gives another company the ability to use their services. In most cases, this is done through purchase or lease, however, there also are some companies that offer free Forex White Label partnership.
But, why would anyone offer their platform to another company for free? The reason for this is that both of the sides that participate in the agreement get some advantages from the process. For the developers of the software, it can be viewed as a promotion without any costs. If the company that uses your platform becomes very successful, more people learn about the software that you have developed. You can also see how people react to the services of your platform and use this information to further develop it.
As for the company that is on the other end of the agreement, it saves money by getting a pre-made, proven platform according to which a broker can be developed a lot easier. The best thing, however, is that the Forex trading White Label platform drastically cuts down the operational costs. In most cases, the White Label brokers pay a certain amount of fee, which mostly tends to be floating depending on the turnover.
Although there are many advantages that White Labeling comes with, there also are some disadvantages. One of the biggest disadvantages is that the commissions must be paid in any case. Although most of the contracts provide a percentage of the turnover, most of them also include a fixed commission. The thing is that there is no guarantee that the company will be successful, because of which, the company might have to pay commission to the developer even if the business fails.
Another very important downside is that resorting to a white label solution provider largely decreases your independence as a broker, as well as room for growth. In addition, you also become dependent on the provider of the platform. However, it should be noted that such problems and challenges become less noticeable when you look at so many advantages that white labeling offers.
As we have already said, white label partnership Forex brokerages are very common in the market, however, there are some alternatives to it. One of the best-known alternatives of white labeling is introducing brokers or IB for short. This option offers traders less resistance and will allow them to enter the market with fewer risks. White you will not be working with your own clients with this solution, you will be referring them instead.
Compared to white labeling, IB is a very simple form of partnership between a primary Forex broker and another company.
As the White Label Forex definition indicates, it is one of the easiest ways to establish a Forex broker. Creating a whole new broker on your own, from the scratch, can be a huge headache as it is associated with a lot of challenges. On the other hand, White Labeling offers you to use the services created by a provider without having to do much on your own.
There are two major types of white labeling, partial white labeling, and full white labeling. Depending on your needs and the level of expertise and of these two can be very helpful. There have been dozens of brokerages that initially started out as White Labels and managed to become independent, successful, and leading Forex brokers around the world.
White Labeling makes everything a lot easier, which is why it is so popular in the market. In addition to being very straightforward, establishing a White Label Forex brokerage is also a lot more cost-effective compared to creating a Forex broker on your own.
Get the most recent news at your inbox
Stay up to date with the financial markets everywhere you go. We won’t spam you.
