Reaching clients is one of the biggest challenges for forex brokers as they always want to grow and make more profits and most brokers also work with third parties to gain more clients and expand their business

Brokers typically use two types of agents:

Introducing Broker (IB): An independent third party designed to introduce the services of a broker to new clients with lucrative commissions。White Label (WL): A business arrangement in which a company establishes an exclusive partnership with a forex broker and uses its trading platform and technology to provide trading services under the company's own brand.

Introducing Broker (IB)

Introduction Broker (IB) is the most direct cooperation system between brokers and third parties。The aim is to introduce the broker's services to new clients, in return for which the third party is paid for each client it brings.。The Introducing Broker (IB) is responsible for hosting clients and guiding them to the Prime Broker

They return in two ways:

International brokers offer a fixed fee return for each client, different types of accounts and the amount of the client's first deposit will incur different fees。Spread sharing or percentage of each trade the client makes with the broker

Many IBs are personal businesses, while others are larger legal companies.。The process of becoming an IB is relatively simple。First, meet all the requirements in the Introducing Broker Agreement, obtain a license, and submit it to the brokerage firm or commission dealer

Typically, an individual broker must already be affiliated with a brokerage firm before applying。For example, in the United States, applicants must be registered with the NFA (National Futures Association) as an FCM, CTA, or IB to act as an introductory broker

Once approved, IB will receive an ID, reference link and promotional materials。If a country does not require an IB to hold a license, then applicants are still required to submit proof that they can work as an IB, usually in the form of a compliance letter from a lawyer.

To play their role, international brokers can gather clients by partnering with successful traders, fund managers, investment advisors, financial website owners, and other high-traffic websites

Then, in order to refer customers to brokers, IB can use a variety of methods, such as email marketing campaigns, social media promotions, placing broker banners on the IB website, etc.

Some brokers will give their affiliate IBs a unique link to track new clients and access specific regions, allowing IBs to download promotional materials and start targeting clients。When a client opens a trading account with a broker through IB's reference link, IB will be rewarded according to the agreement or contract

Sometimes, traders encounter difficulties when trading with international brokers because each country has different laws and regulations。But in this case, IB can act as a good "middleman" and provide some advantages, such as:

1.Effective Guide

IB connects traders with brokers regardless of their nationality and location。Without them, local traders tend to be hindered from international brokers by language barriers, different payment methods, etc.。Especially for beginners, using IB services will be very helpful

2.Prevention of fraud

To become an IB, you must meet basic requirements and obtain a license to operate。Most IBs also only work with brokers under legitimate regulators, so traders can safely conduct trading activities and trade。In other words, traders can use IB to stamp out unregulated brokers suspected of fraud and prone to bankruptcy.

3.Additional Rewards

To gain more attention from new customers, IBs often offer offers and gifts in exchange for traders' commitments to their deals.。This service is hardly found in most brokers, so many traders prefer to look at IB's offers before choosing a prime broker

4.Expert help

Beginners usually have limited knowledge of forex trading activities and how to choose the right broker。In this case, many IBs support consulting and expert assistance to provide traders with information。As a middleman between traders and brokers, international brokers teach traders about the Forex trading industry。To this end, they can provide a complete explanation or directly answer customer questions about the transaction

5.Customer Support

Brokers also sometimes provide client support to the broker's clients。They are responsible for accompanying and guiding clients in their trading activities。Not only that, IB also accepts complaints and questions about the broker's trading conditions.

Customers often encounter problems such as slow execution, frozen charts, system errors, failed transactions, etc.。Using IB can make it easier for customers to report such issues and get quick responses afterwards

White Label (WL)

White Label (WL) has different goals and more complex systems than IB。WL has its own forex broker, uses its own brand and does not just refer clients to the prime broker。WL Business works with existing forex brokerage firms to use the brokerage firm's trading platform and liquidity under its own unique brand under an agreement with the brokerage firm

Essentially, WL works in the same way as IB, but usually, WL can get more convenience from the main broker。They can put their own logo on the trading platform, determine the size of the spread, manage their own customers。WL does not act as a bridge between clients and brokers, but rather has its own clients and only works with brokers to use its services

In addition to profiting from contracts with prime brokers, WL also profits from the trading volume of clients, so its function is similar to that of ordinary brokers。

In general, WL operates quite differently from IB。White Label Broker is a complete operating organization with its own risk management, PSP, customer support, etc.。However, a white-label broker must work with a prime broker, which acts as a technology provider with a trading platform and back-office support, in order to be fully operational.

Depending on the service provided, there are two types of WL:

Full WL mainly has two key parts, one is the brand trading platform and the other is the ability to take deposits directly from customers。Thus, a full WL can also make payments and withdrawals to customers and manage their accounts

Limited WL also includes a rebranding platform, but cannot absorb customer deposits。Therefore, "limited" does not mean reduced profits or free travel on branded foreign exchange trains, but it can only provide limited facilities and services compared to the full WL

Services not provided by Full WL and Limited WL:

1. Currency Pair Trading Symbols。Market opening and closing times。Anything related to computer security systems

Conclusion

From the goal point of view, the introduction broker and the white label are similar; to better understand their differences, please check the following table:

Broker Partners	Mode	目标	Promotion	Incentives / Revenue
Introducing Broker (IB)	System of cooperation between brokers and third parties	Introducing the services of brokers to new clients	✔️	Fixed cost return spread sharing
White Label (WL)	Brokerage companies using their own brand	Trading platform and liquidity for brokers with their unique brand	✔️	profit from the client's trading volume。

You can use the IB's quotes as a filter for selecting excellent forex brokers as most brokers are affiliated with many IBs。At the same time, WL is at least experienced in attracting and maintaining good relationships with third parties and managing and meeting customer needs