What is an introducing broker — and how IBs get paid

What an introducing broker actually is

Strip away the marketing and an introducing broker does one thing: it introduces a trader to a broker. It is the referral layer of the industry. The broker keeps the two jobs that require a license and client money — executing your orders and holding your funds — and pays the IB for sending business its way.

That division matters more than it sounds. When you open an account through an IB, your deposits, your trades, and your withdrawals all sit with the broker, inside the broker's regulated custody. The IB is never in that path. It cannot touch your balance, cannot see your withdrawals, and does not stand between you and your money. If an "IB" ever asks you to deposit with them, that is not an introducing broker — that is a scam wearing the word.

The role is regulated where it matters. In the United States an IB must register with the CFTC and be a member of the National Futures Association; an independent IB carries a $45,000 net-capital requirement, while a "guaranteed" IB is backed by the broker that clears its trades. Our own partners, IC Markets and Pepperstone, are ASIC-regulated in Australia, where the introducing relationship operates under the broker's financial-services license. The details differ by jurisdiction; the shape does not — the IB introduces and is paid, the broker holds and executes.

The four ways an IB gets paid

Every rebate, discount, and affiliate deal you have ever seen is one of four payment models, or a blend of them. The broker funds all four out of the money you already pay to trade — but they do not all treat you the same way. Two are neutral to your interests, one is quietly aligned with them, and one is aligned against them:

Read that last column again, because it is the part no rebate site prints. A CPA introducer is paid the moment you deposit and earns nothing after — so its whole incentive is to get you funded, not to keep your costs low once you are. A spread-markup introducer is the one to walk away from: it is paid more when your trades cost more, so its interests and yours point in opposite directions. A per-lot introducer earns only while you actually trade, which at least ties its income to you sticking around — though it can still nudge you toward overtrading, which no rebate ever makes worthwhile.

What a per-lot IB does with its share

The per-lot model is where the interesting decision lives, because the IB gets to choose what to do with the share it collects. There are three routes, and they are the entire subject of how forex rebates work:

• Keep it. The classic affiliate. You pay $7.00 a lot, the IB pockets its $1.00–$2.50 share, you see none of it.
• Pay part of it back later. Cashback. You still pay $7.00 and wait for a payout through a portal, above some minimum, weeks after the trade.
• Hand it back at the source. The IB pools its traders and negotiates your commission down directly, so the broker simply bills you less. This is what Forexnese does — $7.00 becomes $5.50 at IC Markets and $6.00 on Pepperstone Razor.

The share is the same money in all three cases. The only difference is who ends up holding it — the introducer, a middleman, or you. Everything on this site is built on the third route.

How to tell which model your IB uses

You do not have to take anyone's word for it. Three checks tell you exactly how the introducer behind your account is paid — and whether it is quietly costing you:

1. Compare your spreads to the published raw spreads. Put your account's live EUR/USD spread next to the broker's public raw-spread figure during the same session. If yours is wider, an IB spread markup is being skimmed on every trade. They should match to the pip. This is the single check that catches the one adversarial model. The full anatomy of that bill is in what a round-turn lot really costs.
2. Look at your commission line, not a promise. An at-source deal shows a lower commission on every trade confirmation your platform prints — nothing to claim, nothing to track. If the "discount" only exists as a balance accruing on someone else's website, it is cashback, and you are carrying counterparty risk until it pays.
3. Ask the broker directly. Support will tell you whether the IB group your account sits under carries a custom spread markup. Brokers answer this plainly; an honest introducer has nothing to hide in the answer.

How we get paid, exactly

We are an introducing broker, and we are paid the same way every per-lot IB is: the broker shares part of your commission with us. When you trade a lot at IC Markets you are billed $5.50, and the broker passes a share of that to Forexnese from its own side. Open the same account with no IB and you would be billed $7.00 — and the broker would keep the lot. Our income comes out of the broker's margin, after it has already cut your price by $1.50. That is why the deal costs you nothing, and why we can say so without an asterisk.

There are no listing fees, no paid placement, and no spread markup on any account we introduce — a markup would put us in the one column of that table we tell you to avoid. We list two brokers and two VPS providers because we run our own accounts and EAs on them, and each has to pass four verifiable tests before it goes on the site. Those tests, and exactly what they have already vetoed, are in why we only list two brokers.