In the regular sense, white-label is one of the most popular forms of partnership where one company produces goods and other companies sell them under the name of. When it comes to Forex, a white label is an affiliate program where an infrastructure provider offers its expertise with a new brokerage, in exchange for a fee or commission. This infrastructure provider is also called the white-label provider. In simple terms, the job of the white-label provider is to allow an aspiring broker to get access to the market of forex. The firm will not only provide trading platforms to new brokers, but will also help customers in a range of issues.
A white-label broker, on the other hand, is the one who pays an amount to the white label company to use their infrastructure as well as other services. Whenever there are technical glitches, the white-label broker can reach out to the white-label company. Many traders are unaware that they deal with white label forex brokers. Why would brokers choose such a service? Well, one of the best reasons could be to kick start their business without committing huge expenses. It is difficult to start a business from the ground up. The founders will need to invest a lot on the technical infrastructure. They can start their business with ease by working with a white-label provider to cut down on these costly expenses.
A partnership like this has another great advantage: the new brokers can use modern technology to meet the demands of their clients. Instead of spending time creating new software, they are able to make use of existing solutions that are available. They can then choose from the wide variety of solutions and tools offered by white-label suppliers or request them to develop an individual solution that is tailored to the needs of their clients. Many brokers believe that using a white-label service would mean they cannot build their own brand but this isn’t true. Brokers can promote and build their company without mentioning the white-label provider.
White-label Forex is just like a coin that has two sides. Firstly, even when you use this service, you still need to pay a fee to the white label provider regardless of whether or not you’ve made money from your business. Secondly, the white-label provider caters to brokers on a massive scale. Therefore, you can’t expect them to provide you with anything out of the ordinary to make your company stand out. In such a case, you (as a broker) need to come up with something that will distinguish your company from other companies. The third thing is that you can’t be flexible and must rely on the company to provide the services you require. If the white label provider charges you too much, doesn’t offer up-to-date technical equipment, or even shuts down their operations, it may result in a difficult situation.
White-label Forex can be a great way for new forex brokers to get into the business. However, they need to be aware. They need to choose a trusted white-label provider that can help them grow and remain transparent within their business operations.