How Cashback Sites Make Money: Why They Are Free to Use
Worried about how a free cashback site actually makes a profit?
In short, the revenue comes from the broker, not from you. The site returns part of the partner reward it receives from the broker to its users.
This article explains the flow of money, why your trading costs do not increase, and what to look for in a site's transparency.
Summary: A cashback site's profit comes from the broker's reward
- The revenue source is the partner reward the broker pays the site
- The site returns part of the reward it receives to users as cashback
- It is not a system where users pay extra fees
- Whether the site discloses the link between ads and rankings is a good trust indicator
How cashback sites work and how rewards flow
Overseas FX brokers pay rewards to partners who refer new customers. The reward is generally based on the trading volume of the customers referred.
A cashback site works with brokers as such a partner. It returns part of the reward it receives to users and uses the rest for operating costs.
- 1
You open an account via a referral link
An account opened through the link counts toward the site's referral results.
- 2
You trade
The broker earns revenue from spreads and fees.
- 3
The broker pays the site a reward
The broker sets the amount according to conditions such as trading volume.
- 4
Part of the reward comes back to you
With auto-rebate, the broker's system credits it to your trading account automatically.
Why your trading costs do not increase
The broker pays the partner reward out of its own revenue. It is not funded by adding to your spreads or fees.
However, a broker may set conditions by account type. Check the official information to see whether trading conditions differ when you come through a referral.
XB's share and your share
How a site splits the reward between itself and its users is a matter of its operating policy. How a site thinks about this split is useful when choosing one.
| Viewpoint | What it means for you |
|---|---|
| Your share | The amount returned to your account based on trading volume. The larger it is, the lower your effective cost |
| The site's share | Goes to running the site and verifying information |
| Payout method | Peace of mind differs depending on whether the broker credits it directly or the site pays separately |
| Clear conditions | Check that eligible accounts and credit timing are stated |
What to check for operational transparency
The more a site is free to use, the more important it is that it discloses how it earns revenue. The relationship between ads and listing order is also worth checking.
XB states in its editorial policy page how it verifies broker conditions and how advertising relates to listing and ranking. Our policy is to publish information based on official primary sources, with the date checked.
- Whether operator information and contact details are public
- Whether it states that it receives rewards
- Whether it describes the link between ad placement and ranking
- Whether it shows the basis and date checked for its conditions
See the conditions of auto-rebate brokers and the reward information planned for launch.
See supported brokersFAQ
Q.Why are cashback sites free to use?
Because the partner reward that brokers pay the site is the revenue source. The site charges users no fees and returns part of the reward to them.
Q.Do my trading costs increase if I use cashback?
The broker generally pays the reward out of its own revenue, and it is not a system that adds a burden on you. Also check the broker's official information for conditions.
Q.How should I judge a site's transparency?
Four points are a good guide: operator information, disclosure that it receives rewards, the link between ads and rankings, and the basis and date checked for its conditions.
This article is for information purposes only and is not investment advice. Conditions may change, so please check each broker's official page for the latest information. Offshore FX and CFD trading carries a risk of losses exceeding your principal.
