When setting up a forex trading platform, there are two options: a full-service platform and a white-label platform. A full-service platform offers greater autonomy but requires a higher initial investment and is more complex to operate; it is better suited for companies with strong financial resources and extensive trading experience. For startup forex brokerage firms, however, a white-label platform involves lower costs and is easier to operate, making it a better choice for companies just getting started.
White-label services are a business model in which a technology company or large brokerage firm provides platform development, liquidity access, and other services to companies seeking to become forex brokers. This model enables startups to independently attract clients under their own brand and launch forex trading operations.
The following are the main steps involved in building a trading platform through a white-label model:
1. Registering an Overseas Company
White-label companies must first obtain business licenses in overseas jurisdictions, such as the United States, the United Kingdom, New Zealand, and other countries. Companies can choose an appropriate country for registration based on their specific circumstances and local policies; this is an essential step in building a trading platform.
2. Apply for a Trading Platform
Once a company has successfully registered overseas, it can submit an application to an established, reputable trading platform to obtain access to the platform. White-label companies can build their own client-facing applications on the trading platform, attract clients, and conduct forex brokerage operations. In addition, white-label companies can opt for trading platforms developed by fintech companies, an approach that typically allows them to access a wider range of customized services from these tech firms.Selecting a trading platform with mature technology, user-friendly operation, and a good user experience is crucial for brokers.
3. Connecting Liquidity
Retail forex brokers need to partner with financial institutions, such as international banks, to establish their own liquidity pools and provide liquidity for forex trading orders.White-label companies can connect directly with liquidity providers or access them through a bridging firm. However, the former approach is more challenging and costly. If the quality of existing liquidity providers is high, opting to use a liquidity provider’s bridging service is a wiser choice for startup forex brokerage firms.
4. Implement a CRM system
A CRM system is a key tool for brokerage firms to manage their clients. Typically, a CRM system should include features such as fund deposits, account management, user data storage, and data analysis. A forex CRM system should be able to integrate various payment methods to accommodate different clients’ payment preferences and facilitate client fund deposits and trading. Fintech companies typically offer services to build CRM systems.
5. Obtain a regulatory license
A brokerage firm’s regulatory license is an important benchmark for clients to assess the firm’s legitimacy and the security of their trading funds. Common regulatory licenses include the UK’s FCA, New Zealand’s FSP, and Australia’s ASIC, among others. Obtaining a regulatory license from a major regulatory authority is extremely helpful for a brokerage firm in gaining client trust and conducting retail forex business.
As a leading fintech platform, Leverate provides brokers with one-stop white-label platform development services, significantly reducing the complexity of platform development for brokerage firms and lowering their startup costs.At the same time, Leverate provides consulting services to brokerage firms regarding overseas company registration and the application for regulatory licenses, making it a valuable partner for startup forex brokerage firms.
