Attracting new customers on a market that is as developed and as competitive as the retail forex one can be an arduous and expensive task, therefore many brokers rely on outsider help for that. We are speaking of partnership programs – forex affiliates, introducing brokers, etc. Ultimately, the goal of all of them is the same: to bring more customers to the brokers, and to get rewarded for that.
Now that we have mentioned rewards, let's take a look at the most common payment schemes: revenue share, CPA and commission.
With revenue share payments the affiliate receives a certain percentage of the revenue the broker gets from the traders referred by the affiliate. The trouble with revenue share payments is that affiliates don't see the revenue of the traders they have referred, so there is pretty much no transparency with that payment structure, allowing for the brokers to do whatever they feel like.
CPA stands for “Cost Per Acquisition” and with it affiliates receive a certain, usually fixed amount of money for every deposit made by the traders they have referred to the broker.
Commission payment schemes are similar to the revenue share ones – but here affiliates get a fixed commission for each order placed by the trader, regardless of whether the trade brings the broker profit or not.
When you sign up with a partnership program, brokers usually provide you additional materials to help you advertise them and attract more customers – banners, promotions, widgets, etc.
As we mentioned at the beginning, partnership programs are extremely popular on the spot forex market, therefore pretty much any broker offers one in one form or another. You will find a list of all brokers offering affiliate/IB programs below but before that we will give you a few examples of such programs.
With ZuluTrade's program, affiliates earn commissions of 1 pip per trade for AAAFx accounts and 0.4 pips per trade for all other brokers; of course, the pip value varies depending on the currency pair traded, but this translates to roughly to an average of $4 to $10 per traded lot.
The program is quite convenient as a single registration gives the platform's partners access to 59 brokers and counting (ZuluTrade adds new brokers on a regular basis). It promises 7% conversion from demo to live accounts, which is quite high compared to the industry standards.
Once you make some profit as an affiliate, you can withdraw your money using the following payment methods: bank wire transfer, PayPal and ZuluTrade Mastercard. In order to request a cashout, you would need to have an active account balance with a minimum of $100, and you will be charged the following withdrawal fees as well:
- $20 for PayPal requests up to $500 and a 3,9% fee (applied on the requested amount) for PayPal requests greater than $500;
- $30 for wire transfers within the United States, and $45 for wire transfers outside the USA;
- $20 for each payment to the ZuluTrade Mastercard.
The one thing you should be aware is that it takes 6-8 weeks for you to get your money, and you will probably be asked to submit a proof of address every time you cash out.
AAAfx is ZuluTrade's own brokerage, therefore its affiliate program is directly connected to the one of ZuluTrade. In other words, in order to become an AAAFx referring broker, you have enroll as a ZuluTrade affiliate first. By enrolling, you will receive a link that directs you to your personal ZuluTrade page where AAAFx will appear as the only broker available.
Affiliates get paid up to 1 pip per traded lot (approximately $10 per lot for standard accounts). Keep in mind, however, that once you try to withdraw, you will be asked to submit proof of address even if you have already done so, and it will take up to 8 weeks to get your money. The fees and payment methods available are the same as ZuluTrade's.
eToro offers both IB and affiliate programs. If you opt for the second, you will have a choice between revenue share and CPA payment schemes. With a revenue share plan you will be getting 25% of the revenues eToro makes off your referred users (be careful, though, because if your traders actually win money and the broker has losses, you will have to cover these losses from your payments!). CPA pays up to $200 for each new depositing trader you bring to the broker (this is a one off payment).
The broker's IB program is intended for financial trading companies, trading education providers, social networking companies, and money managers. eToro's introducing brokers earn up to 40% revenue share.
Affiliates get paid once a month, usually within 15 days from the end of the previous month. The minimum amount to withdraw by wire transfer is $500, and by PayPal - $100. Payments are generally processed quite quickly.
While all this sounds great, we must warn you that you absolutely must read the fine print on the affiliate/IB agreement with eToro before signing it – the broker has included far too many options not to pay you and/or cancel your agreement. One of the nastiest terms is the fact that eToro can change your payment scheme upon its discretion – so one day you're getting a revenue share, and the next one you're on a CPA scheme all of a sudden. You haven't recruited at least 3 new traders for the past 3 months? Your agreement is canceled and you're no longer an affiliate. Your traders got bonuses? These get deducted from your payment right away.
This list goes on so let us repeat: read the fine print!
FxPro operates on a commission basis, and the payments depend on the currency pairs traded; affiliates get commissions of up to 0.91 pips on EUR/USD, or 1.12 pips on GBP/USD for example.
What's more, once you become an affiliate of this broker, you will be getting a great set of promotional and marketing tools – a free content management system, daily market news and videos, an economic calendar and widgets, reporting tools, etc.
In order to get paid, affiliates need to have at least 5 recruits – so make sure you attract at least 5 traders to get your money.
What is really cool about this broker's affiliate program is that you get your commissions deposited into your trading account at the beginning of each month. After that you can cash the money out following the broker's general withdrawal rules. The available withdrawal options are credit/debit card (processed within 2 business days), and bank wire (it takes 3 – 5 business day to get your money). FxPro charges no additional withdrawal fees.
Instaforex offers a gazillion partnership programs – there's one for IBs, another one for bloggers, one for webmasters, and so on, and so on.
All the different programs offer partners a commission of 1.5 – 2 pips per trade (up to 10 pips for Gold trades). All the programs also offer the option of recruiting sub-IBs and get an extra 0.1 pips for deals of the clients referred by these sub-IB. Commissions are credited to affiliates' accounts at the end of every day and can be withdrawn at any time. We recommend a withdrawal via Payoneer card in order to avoid including this income in your annual tax declaration. The rest of the cashout options available are credit/debit card (payment processed within 1-6 business days), bank wire (2-4 business days), PayPal (48 hours), Liberty Reserve (1-7 hours), and Moneybookers/Skrill (1-7 hours). Keep in mind that the broker may charge you different withdrawal fees depending on the payment method you choose.
The biggest benefit of InstaForex's partnership programs is that they all offer a great variety of marketing materials – banners, news widgets, calendars, interest rate widgets, promotions and bonuses, etc.
You should be warned that Instaforex affiliate managers are quite aggressive and will probably flood your inbox with emails and offers.
Up to $400 CPA, up to $50 commission per lot traded and 10% commission on Tier 2.