What Is Overseas FX Cashback? How It Works, Why It Exists, and Cautions
Wondering whether overseas FX cashback really puts money back in your pocket?
In short, cashback passes part of the referral fee a broker pays to a partner back to the trader. It is returned to your trading account automatically, based on your trading volume.
This article explains why the money comes back, how cashback differs from bonuses, and what to watch out for.
In short: cashback returns part of your trading cost
- The source of cashback is the referral fee a broker pays to its partner (IB)
- It is calculated from trading volume (lots) and is paid whether you win or lose
- With an auto-rebate broker, it is credited to your trading account with no application
- Unlike bonuses, it generally has no withdrawal restrictions
How overseas FX cashback works
Overseas FX brokers pay the partner (IB) who referred a client a fee based on that client's trading volume. Cashback returns part of that fee to the trader.
In other words, part of the money the broker spends on advertising comes back to you. You do not pay any extra cost.
- 1
You trade
The broker earns revenue from spreads and commissions.
- 2
The broker pays the partner
A few dollars per lot is paid based on the referred client's trading volume.
- 3
Part of the fee returns to you
With auto rebate, the broker's system credits your trading account automatically.
Cashback vs. bonuses
| Item | Cashback | Deposit bonus |
|---|---|---|
| Source | Part of the referral fee | Broker's promotional budget |
| Condition | Based on trading volume | Based on deposit amount |
| Withdrawal | Generally withdrawable | The bonus itself is often not withdrawable |
| Effect of wins and losses | None | None (but expiry conditions apply) |
| Combining | Depends on the broker's terms | Depends on the broker's terms |
A bonus increases your margin, and it is generally not withdrawable. Cashback returns actual cash, so it can be withdrawn as account balance.
Auto rebate vs. traditional cashback
Traditional cashback sites mainly tallied volume each month and paid separately by bank transfer or e-wallet. Some require applications or withdrawal procedures.
With auto rebate, the broker's system credits your trading account directly. XB only lists brokers that support auto rebate.
Why XB only lists auto-rebate brokers
Three reasons: no application, fast crediting, and no risk of late payment from a site. You just open an account and trade.
Cautions when receiving cashback
- Many brokers only cover new accounts opened through a referral link
- Cashback amounts differ by account type, or some account types may be excluded
- It may not be combinable with bonuses (check the terms)
- Cashback may also be taxable income (check with a tax accountant or the tax office)
See the list of brokers that support auto rebate and how to receive it.
View supported brokersFAQ
Q.Do you really get cashback on overseas FX?
Yes. It is funded by part of the referral fee the broker pays to its partner, and is based on trading volume. With an auto-rebate broker, the broker's system credits it to your trading account automatically.
Q.Do I get cashback even if I lose?
Yes. It is calculated from trading volume (lots), not from whether you win or lose.
Q.What is the difference between cashback and a bonus?
A bonus can be used as margin but is generally not withdrawable. Cashback is added to your account balance and can be withdrawn.
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.
