Grey label vs introducing broker: when an IB should move to its own

What is the difference between a grey label and an introducing broker?

An introducing broker sends clients to a broker and gets paid for them; a grey label lets you become the brand those clients see. That single change — whose name is on the login screen, the app icon and the account statement — moves almost everything else: how you earn, who signs with the client, who answers the support ticket at 2 a.m. and what you can take with you if you leave.

As an introducing broker you market a partner broker. Clients open accounts on the partner’s website, sign the partner’s terms and trade on the partner’s server. You get a rebate per lot, a cost-per-acquisition fee or a revenue share, and the partner’s back office tells you what you have earned.

An MT5 grey label is a brokerage set up inside another company’s licensed MetaTrader 5 server: you get your own client groups and your brand on the WebTrader, mobile apps, CRM and client portal, while the MT5 server licence stays with the provider. Grey label is an industry term, not a MetaQuotes product, so two providers can mean slightly different things by it. Always read what is actually in the contract.

The phrase has been around for years. Atomiq Consulting described the model in January 2017 as one that “toes the line between an IB (Introducing Broker) relationship and an MT4/MT5 white label” — and that is still the most useful way to picture it: one step beyond an IB, one step short of a white label.

IB vs grey label vs white label vs own MT5 licence: how do they compare?

The four models sit on one ladder of control, cost and responsibility. The table below compares them on the points that matter most to an IB thinking about the next step. It describes typical arrangements; individual contracts vary, and your regulatory position depends on where you and your clients are.

How does an IB earn compared with a grey label?

An IB earns a fixed slice of what its clients generate; a grey label earns the margin between what clients pay and what the trading actually costs, minus the provider’s fees. The first is predictable and small. The second is larger, less predictable and comes with costs an IB never sees.

There are three income shapes you will meet. A rebate is a fixed amount per lot traded, paid by the partner broker. A revenue share is a percentage of the net trading revenue on your clients, either as an IB deal or inside a grey label contract. Owning the spread means you set the markup or commission on your own client groups and keep what is left after liquidity and platform costs; on a grey label this usually happens within limits the provider sets.

There is no standard revenue split in grey label deals, and the headline percentage tells you less than the definition behind it. A generous-looking share of “revenue” can be worth little if revenue is measured after the provider deducts liquidity costs, swaps, rebates to your own sub-IBs and a platform charge. A smaller share of gross spread and commission can be worth more. Before you compare two offers, rewrite each one in the same terms: what is counted, what is deducted first, how often it is settled and who produces the report.

We do not publish figures on this page because they move with the provider, the server, your volume and your markets, and an old number quoted out of context does more harm than good. If you want current figures for your setup, message us on WhatsApp with your volume and markets and we will send them.

Does moving from IB rebates to a grey label pay off? A worked example

It pays off only if your clients trade enough, and your markup is wide enough, to cover the fixed costs a grey label adds. The example below is entirely hypothetical and shows the logic rather than the numbers; plug in your own volumes and the terms from the quotes you hold.

Say you are an IB with about 300 active clients who together trade 2,000 standard lots of major FX pairs a month. Your partner pays a fixed rebate per lot, so your monthly income is simply volume times rebate, with no platform bills and no support desk.

Now say you move those clients to a grey label and set a markup on EUR/USD-type pairs that, per lot, earns roughly what the rebate used to. On paper your gross income is unchanged. The difference is what happens next. From that same gross figure you now pay the provider’s monthly charge and any revenue share, your CRM, payment and KYC costs, support staff, and the cost of clients who leave because your spreads are wider than the partner’s were. If you run any risk in-house rather than passing every trade to liquidity, your result also swings with client profit and loss.

The upside is in the lines an IB cannot touch: you can price groups differently, add commission accounts, keep clients who would have been lost to a partner’s retention team, and build a brand that has value of its own. Most IBs that make the move do so because the client base is already large and loyal enough to carry the fixed costs — not because the per-lot maths looks better in month one.

1. Measure your real volumeTake six months of lot volume and active-client numbers from your IB reports, not your best month.
2. Write down every fixed costProvider fee, revenue share, CRM, payment gateways, KYC checks, support staff, compliance advice, marketing.
3. Model the markup you can chargeCompare your planned spreads with what your clients pay today; wider spreads cost clients.
4. Find the break-even volumeDivide the monthly fixed costs by your expected margin per lot. If you are not clearly above it, wait.

What drives the cost of a grey label for an IB?

Five things drive the cost: how much of the stack you take, how many accounts and how much volume you bring, whose liquidity you use, how the provider shares revenue, and how long you commit for. Two quotes that look far apart often turn out to cover different things, so compare them line by line rather than by the total.

The first line is the server side: your client groups and Manager access on the provider’s MT5 server. The second is the front end: branded WebTrader and iOS and Android apps, plus the work of publishing the apps under your own developer accounts. The third is the back office: a CRM with onboarding, KYC, payments and IB commissions. FXUP has its own broker CRM and also works with partner CRMs, and we propose whichever fits the client; the choice changes both the scope and the running cost. The fourth is liquidity and the bridge. The fifth is everything a quote tends to leave out.

• Usually included: client groups, Manager access, a branded WebTrader and the initial configuration of symbols and conditions.
• Often priced separately: mobile apps, app store publishing work, CRM modules such as multi-level IB plans, extra languages, copy trading or PAMM.
• Usually left out entirely: payment gateway fees, KYC check costs per client, your own legal and compliance advice, support staff and marketing.
• Contract terms that change the real cost: minimum term, notice period, how fees may rise after the first term, and what data export costs when you leave.

Whose licence do clients trade under on a grey label?

It depends on how the grey label is structured, and that is the question you must settle before anything else. In a technology grey label you get space on the provider’s MT5 server, but you still need whatever authorisation your jurisdiction and your clients’ jurisdictions require for the activity you carry on. In other set-ups the provider’s regulated entity contracts with the clients and you act as its partner or representative.

Some regulators run formal regimes for operating under another firm’s licence. The UK is the clearest example: the FCA’s appointed representative regime lets a firm carry on regulated activity under the responsibility of an authorised principal, which then answers for it. That is a regulated relationship with obligations on both sides, not an informal promise in a technology contract.

Do not accept a provider’s line that you need “no licence” with a grey label. Whether you do depends on where your company is registered, where your clients live, what you market and which activity you perform. Ask a lawyer in your target market, and check our overview of forex licence jurisdictions before you commit to a structure.

Whose name goes on the client agreement and who holds client money?

Whoever signs the client agreement is the firm the client has a legal relationship with, and that firm should also be the one holding or controlling client money under the applicable rules. As an IB, both are your partner. On a grey label, both must be written down clearly before you onboard a single client.

Ask three direct questions. Which legal entity appears on the client terms, the risk disclosure and the account statement? Into whose bank or payment account do client deposits land? Who decides withdrawals? If the honest answer to all three is “the provider”, you are closer to an advanced IB with your own brand than to an independent broker — which can be perfectly fine, as long as you know it and your marketing does not suggest otherwise.

This is also where trust between partners matters. An IB moving to a grey label often keeps the same partner as the provider. That works well when the partner is open about the structure; it goes badly when the contract allows the provider to contact or move your clients. Read the non-solicitation and data clauses as carefully as the fee schedule. If you would like a second pair of eyes, send us the draft on WhatsApp and we will tell you which clauses we would question.

When should an introducing broker move to a grey label?

Move when your clients come to you because of you, not because of the partner’s brand — and when the volume can carry the fixed costs. Below are the signs we look for when an IB asks us whether it is time.

Which kind of IB gains most from a grey label?

IBs that already own the relationship with their clients gain most. A few typical profiles, described generally rather than as client stories:

• Education and signals communities. Clients follow the educator, not the broker. A branded WebTrader and app keep the community in one place, with your courses and your language.
• Regional IBs with sub-IB networks. A grey label lets you run your own IB commission structure in a broker CRM instead of depending on the partner’s partner portal.
• Affiliate and online-marketing IBs. These earn well on CPA but rarely own a loyal base. A grey label usually makes sense only once retention, not acquisition, becomes the focus.
• Strategy providers and money managers. Copy trading and PAMM need careful regulatory review; see our copy trading regulation guide before treating a grey label as the answer.

How do you move from IB to grey label, step by step?

The technical part is the short part: FXUP typically has a grey label live in about one to two weeks once documents, liquidity and branding are ready. The longer work is legal structure, payments and telling your clients.

1. Settle the structureDecide with your lawyer and the provider who signs client agreements, who holds client money and what authorisation you need where.
2. Agree commercial termsFees, revenue share, markup limits, minimum term, data export and exit clauses, all in writing.
3. Configure groups and brandingClient groups, symbols and conditions are set on the server; your logo, colours and domain go onto the WebTrader, apps and CRM.
4. Connect payments and KYCPayment gateways and identity checks are set up in the CRM so clients can open and fund accounts under your brand.
5. Test with your own teamOpen accounts, deposit, trade, withdraw and pay a test IB commission before any real client arrives.
6. Migrate clients in wavesInvite your most active clients first, collect feedback, then move the rest. Clients open new accounts; old IB accounts remain with the partner.

Can my branded app go on the App Store and Google Play as a grey label?

Yes, but the publishing account and the licensing behind it matter more than the code. Apple’s App Review Guidelines expect trading apps to come from the institution providing the service, and to be licensed where they are offered. That is why our apps are publishable on the App Store and Google Play under your own developer accounts, and why you should agree early which entity owns those accounts.

Guideline 3.2.1(viii) says: “Apps used for financial trading, investing, or money management should be submitted by the financial institution performing such services and must have necessary licensing and permissions in the locations where you make them available.” Guideline 3.2.2(viii) adds that apps facilitating CFDs or FOREX “must be properly licensed in all jurisdictions where the service is available.” Google Play requires apps with financial features to complete a financial features declaration in Play Console.

In practice, store review is where a weak grey label structure gets found out. If the brand on the app is yours but the licence belongs to someone else, expect questions. Our App Store approval guide covers what reviewers ask for; until then, clients can use the branded WebTrader in a browser.

What mistakes do IBs make when they switch to a grey label?

The most common mistake is treating the move as a branding exercise when it is a change of business model. These are the ones we see most often:

• Comparing the grey label fee with last month’s rebates instead of with the full cost of running support, payments and compliance.
• Widening spreads too much in the first month and losing the active traders who carried the IB income.
• Signing without a data export clause, so client records, MT5 logins and trade history cannot be moved later.
• Assuming the provider’s licence covers your marketing in your own country.
• Launching apps under the provider’s developer account and discovering later that the listing cannot be transferred.
• Forgetting sub-IBs: if you have a network, its commission plans must be rebuilt in your CRM before launch, or they will leave.

What does FXUP provide for an IB moving to a grey label?

We set up the grey label and the client-facing technology around it: your client groups on a licensed MT5 server, a branded WebTrader, iOS and Android apps, a CRM with onboarding, KYC, deposits and withdrawals, IB commissions and MT5 account sync, and the liquidity connection. For the CRM we have our own broker CRM and also work with partner CRMs, and we propose whichever fits your operation. A grey label typically goes live in about one to two weeks. You can try the WebTrader demo and the mobile app demo before you talk to us; both run on a real MT5 demo environment.

FXUP is a technology provider, not a broker, and we are not affiliated with MetaQuotes. We quote each project individually; our grey label cost guide explains what drives the price and how to compare quotes line by line, and we send current figures on request. When the grey label outgrows itself, the next steps are a white label or your own MT5 licence. FXUP also works as a consultant on that route: we handle MetaQuotes’ requirements and the licence application for our clients, for a fee. In the applications we handle, MetaQuotes charges a monthly fee that depends on the tier (Entry, Standard or Enterprise), and for the Entry tier it asks for three months to be paid upfront. Ask us for the current figures.

If you want to run your numbers past someone who sees these deals every week, message us on WhatsApp with your monthly volume and markets.

Questions buyers ask

Not covered here? Ask us on WhatsApp, message @FXUPCK on Telegram or write to [email protected].