Sub-IBs and multi-tier IB programs

In a standard IB program, you introduce clients and earn from their trading. In a multi-tier program, you can also introduce other IBs, called sub-IBs, and earn a share of what their clients generate. The IB at the top is often called a master IB.

Key terms

• Master IB: an IB who has other IBs registered under them.
• Sub-IB: an IB who joined through a master IB's link or code.
• Override: the extra commission a master IB earns on their sub-IBs' clients.
• Tier or level: how many layers of sub-IBs the program pays on. Many programs pay on one or two levels only.

How the money flows

There are two common set-ups:

1. Split model: the broker pays the master IB a fixed rate, and the master IB decides how much to pass down to each sub-IB, often set in the broker's partner portal.
2. Override model: the broker pays the sub-IB directly and pays the master IB a separate override on top.

Example (illustration only): a broker pays a master IB $10 per lot. The master IB gives a sub-IB $7 per lot and keeps $3. If the sub-IB's clients trade 100 lots in a month, the sub-IB receives $700 and the master IB $300 from that volume.

Why brokers offer multi-tier programs

A master IB with an established network can recruit, train and support smaller IBs in their region or language, which a broker's own team may not be able to do. In return, the master IB earns from the network's activity.

Why IBs join as sub-IBs

• Training, marketing help and local support from someone experienced.
• Access to a broker they could not get terms with on their own.
• A community of other IBs.

The trade-off is a lower rate than going direct. Once your volume grows, ask the broker whether you can move to a direct agreement, and check the master IB agreement for rules that prevent this.

Risks and red flags

• Recruitment-first pitches. If a program talks mostly about recruiting people, not about serving traders, be careful. Structures where income depends mainly on recruitment can look like pyramid schemes, which are illegal in many countries.
• Unclear splits. If you can't see your own rate and volume in the broker's portal, you can't check what you're owed.
• Compliance responsibility. A master IB can be harmed by a sub-IB's misleading marketing. Brokers may suspend a whole network over one bad actor. Check who is responsible for sub-IBs' promotions.
• Unregulated brokers. Deep multi-level structures are more common with offshore brokers. Always check the broker's licence first.
• Income promises. Never promise sub-IBs income, and be wary of anyone who promises it to you.

Questions to ask the broker

1. How many levels does the program pay on, and at what rates?
2. Does the broker pay sub-IBs directly, or does the master IB split the commission?
3. Can each IB see their own rate, clients and volume in the portal?
4. Can a sub-IB move to a direct agreement later? On what terms?
5. Who is responsible for checking sub-IBs' marketing?
6. What happens to the network if the master IB's agreement ends?

Use our IB agreement checklist for the rest of the contract.

Frequently asked questions

Is a multi-tier IB program the same as MLM?

Not necessarily. A legitimate program pays for real trading by real clients and usually pays on only one or two levels. Be cautious of any structure where income depends mainly on recruiting more people.

Do sub-IBs earn less than direct IBs?

Usually, because part of the commission goes to the master IB. In return they may get training, support or access to a broker they couldn't reach alone.