MetaQuotes has changed the standard MT5 Administrator or Server License Cost from a one-time fee to a fixed monthly fee model. This opens up a plethora of opportunities for aspiring entrepreneurs who are planning to buy a new license and some threats to old MT5 Admin License holders.
In this blog, we will discuss the following:
- New MT5 Admin License or Server Cost
- Who purchases the MT5 Admin License?
- How does price change affect existing Forex Brokerage Solution Providers who hold an MT5 Admin License?
- How does price change affect existing and aspiring Forex Brokerage entrepreneurs?
- What does price change mean for aspiring Forex Brokerage Solution Providers?
Let’s begin to answer these questions one by one!
MT5 ADMIN LICENSES COST 
MetaQuotes has changed the standard MT5 Admin License Cost from a one-time fee of USD 100,000 to a monthly fee of USD 10,000 from Feb 2021. This means the initial cost of Admin License has dropped drastically but in long run, you would be paying many folds higher.
It does have different implications on a different groups of businesses who would be interested in MT5 Admin & White Label Licenses.
WHO PURCHASES THE MT5 ADMIN LICENSE?
MT4 & MT5 Admin Licenses are typically purchased by:
- Large Scale Forex & CFD Brokers who want to have complete control over their forex brokerage business and operations.
- Forex Brokerage Technology Solution Providers who want to provide turnkey forex brokerage solutions to the people who intent to start own forex brokerage business.
On the other hand, MT4 & MT5 White Label Licenses are purchased by aspiring entrepreneurs who want to start their own forex brokerage business. An MT4 & MT5 White Label License comes at a pretty low price to admin cost that too with similar flexibility to operate their forex brokerage business.
It comes as good news for existing MT5 White Label Brokers and aspiring Forex Brokerage Solution providers. They can now easily purchase the MT5 Administrator License at a monthly cost of USD 10000.
HOW DOES PRICE CHANGE AFFECT EXISTING FOREX BROKERAGE SOLUTION PROVIDERS WHO HOLD AN MT5 ADMIN LICENSE?
Existing Forex Brokerage Solution providers who have already purchased the MT5 Admin License for over USD 100,000 may find it a little troublesome. Here is why?
- Their existing MT5 White Label clients that are operating profitably and want to scale bigger with greater control over their business may find it lucrative to upgrade to an MT5 Admin License.
- If they upgrade to MT5 Admin License, existing solution providers get nothing and lose their monthly earnings coming from them.
- As we know an MT5 Admin License holder can issue fresh MT5 White Label Licenses, it could create new competition for existing brokerage solution providers.
HOW DOES PRICE CHANGE AFFECT EXISTING AND ASPIRING FOREX BROKERAGE ENTREPRENEURS?
But million-dollar question is; is it that simple? And the answer is NO! Let me explain to you why!
1# One used to pay a one-time fixed sum of USD 100,000 and get the MT4 or MT5 Admin License but now they need to make a recurring payment of USD 10000 every month.
This makes the entry look easier but staying in the game will require you to shell out much more money. Within 10 months, you would have already paid the earlier sum of onetime payment.
However, it’s at least cheaper to fail with a new pricing structure. Look we know that all business ventures are risky and carry a chance of going bust. It usually takes 5-6 months to test your business plan and see if it’s working or there is a scope for it to work in near future.
If it looks promising, you can continue or simply drop the business and give up your license.
2# Going solo without a Forex Brokerage Solution provider might look cheaper but their business is not as simple as it might appear to you.
They offer a mix of the following expertise that you may find difficult, expensive, and time consuming to develop on your own:
- Business Consultancy. They have ample experience working with other forex brokers and know exactly what works and what doesn’t. If you are starting afresh, these experiences come very handy and help you grow quicker and faster without committing any fatal mistakes.
- Aggregation & Integration: The FX broker solution providers aggregate several things together like the Forex Broker CRM, IB & Affiliate Modules, Liquidity Providers, FIX API, Payment Gateway integration, Plugins etc. It makes a brokers life much easier and they can concentrate of marketing, customer service and operations.
- Software & Tool Development: Running a forex brokerage is not just about a Forex White Label Solution like MT4 / MT5 White Label or cTrader etc. It needs a lot of tools like Forex Broker CRM, IB & Affiliate System, PAMM Software, MAMM Software, Trade Copier Software etc. These developments need a good chunk of investment in infrastructure, software engineers and industry experience.
- Services: Aturnkey forex brokerage solution provider offers several services like offshore company formation, bank account opening, forex license, auditing & compliance, regulatory filings, accounting, website designing & hosting, business emails etc. These are really tedious work that can drain lots of your productive energy and time.
- Marketing Solutions: Most of them provide marketing solutions like Social Media Marketing, PPC Campaign, Facebook Ads, Twitter Ads, Forex Lead Generation, PR Campaigns etc.
So it’s pretty evident that if a forex broker wants to go solo with their own MT5 Admin License they may have to either invest a large sum of money, time, and other resources to build a team that can handle everything on their own or they need to approach these expert solution providers.
WHAT DOES PRICE CHANGE MEAN FOR ASPIRING FOREX BROKERAGE SOLUTION PROVIDERS?
Honestly, to us, it looks very promising. You may question us why because in the long term you are going to pay much higher and it’s a valid apprehension. The point here is whether you have a sustainable and scalable business plan or not.
The upfront MT4 or MT5 Admin License cost of USD 100,000 was a big deterrent to new entrepreneurs to start up a turnkey forex brokerage business. And they would simply work with other solution providers who had MT4 or MT5 Admin License.
Now they can start on their own and test if their business plan is sustainable or not. It’s pretty obvious, if you are able to scale operations, you can easily pay the monthly fee. And if you are not able to keep up, you can shut operations at much lower distress if not comfortably.
As an old saying goes, every change brings threats and opportunities. Cope with threats and make the most of opportunities that the changes bring. Before you jump to purchase a new MT5 Administrator Licence at USD 10000 per month,
- Look at your business plan and see at what numbers you will break even
- Where you will be making decent profits.
- What will it take to make profits that you dream of
- How soon you can break even
- Whether you have technical expertise of team of experts that can handle the technical part of business
- If you need to partner with someone, what are the terms and conditions specially the cost
- All things should indicate a higher probability of success
Last and the most important thing is you need to be convinced and confident that you can make it work.
Wish you all the best.