Master IB and Sub-IB Structure: How to Set Up a Fair Network

A master IB and sub-IB structure lets one introducing broker (the master) recruit other IBs (sub-IBs) under them. The sub-IB brings clients and earns commission on them. The master earns an override on the sub-IB’s business for having recruited, trained and supported them. Most multi-tier IB programmes in MENA work this way, because the strongest IBs in the region are usually connectors who know other connectors.

The single most important design decision is who pays the override. Our view, from watching networks hold together and fall apart: the broker should pay the master’s override on top, not take it out of the sub-IB’s rebate. When the override comes out of the sub-IB’s pocket, the sub-IB eventually notices, resents it, and leaves, often taking clients with them.

The rest of this guide covers how to structure the tiers, track them properly, handle disputes and give sub-IBs reporting they can verify.

How a master IB and sub-IB structure works

At its simplest there are two levels:

• Master IB. Recruits sub-IBs, supports them, and earns an override on their clients’ activity.
• Sub-IB. Brings clients directly and earns a rebate, CPA or revenue share on them.

Some programmes go to three or more levels. In practice, anything past two or three tiers becomes hard to track and harder to explain, and it starts to look like a recruitment scheme rather than a client acquisition channel. Most brokers are better off capping it.

Masters can also bring clients directly. Their direct clients pay them the normal IB rate, and their sub-IBs’ clients pay them the override.

Who pays the IB override: broker or sub-IB

There are two ways to fund the master’s override.

Option 1: taken from the sub-IB. The broker agrees one total rate per lot, say a fixed amount, and the master decides how much of it to pass to the sub-IB. The master keeps the difference.

Option 2: paid by the broker on top. The sub-IB gets their full agreed rate. The broker separately pays the master an override per lot (or a percentage) on the sub-IB’s clients.

	Override taken from sub-IB	Override paid by broker
Cost to broker	Lower and fixed	Higher, by the override amount
Sub-IB’s rate	Set by the master, often unknown to the broker	Set and visible in the agreement
Transparency	Low, the sub-IB rarely sees the full rate	High, both parties see their own terms
Typical outcome	Sub-IBs discover the split and leave or go direct	Sub-IBs stay, masters keep recruiting
Disputes	Frequent, and the broker gets dragged in	Fewer, and easier to resolve

Option 1 looks cheaper. It usually isn’t. Sub-IBs talk to each other, and when one learns that the broker was paying far more than they received, trust breaks down with everyone. The sub-IB often approaches the broker directly to cut the master out, which forces the broker to choose sides.

Option 2 costs more per lot, but it builds that cost into your commission planning from the start. The sub-IB is paid a fair, visible rate. The master is paid by you, for a real job. Nobody is earning from someone else’s hidden margin. That’s what keeps a multi-tier IB programme together over years rather than months.

If your margins can’t support an override on top, reduce the override, not the sub-IB’s rate. Our guide to forex IB commission structures covers how to size each part.

Setting override levels and tiers

There’s no standard override, and every deal is negotiable. A few principles help:

• Size it to the work. A master who trains sub-IBs, handles their questions and helps their clients deserves more than one who simply forwarded a link.
• Make it conditional on active sub-IBs. Pay overrides only on sub-IBs whose clients are actually trading, so masters focus on quality over headcount.
• Limit the depth. Two levels is clean. A third level is manageable if the override is small. Beyond that, the economics and the optics get worse.
• Write the master’s obligations down. Support, compliance oversight of sub-IB marketing, and onboarding.

The master is effectively managing a small team on your behalf. Treat the override as payment for that management, not a reward for recruiting.

Tracking the IB tree in your CRM

None of this works without accurate tracking. Every client must sit under the right sub-IB, and every sub-IB under the right master, from the first click to the last trade.

What the CRM needs to do

• Store a clear IB tree: each IB’s parent, children and level.
• Attribute each client to one IB, permanently, using referral links, codes or manual assignment with an audit trail.
• Calculate commissions at each level automatically, per instrument, from actual trade data.
• Log every change to the tree (who moved, when, approved by whom).
• Produce statements for each IB showing only what they’re entitled to see.

Most forex CRMs used in the region support multi-level IB structures, but configuration varies a lot. Test it with real scenarios before you launch: a client registering without a link, a sub-IB moving between masters, a client switching accounts. Our comparison of forex CRMs for MENA brokers covers the options, and MT4 and MT5 setup affects how trade data flows into it.

Common tracking failures

Clients registering through the website instead of the IB’s link. Clients opening a second account that isn’t linked. A sub-IB moved in the CRM without anyone telling them. Each of these costs someone money, and the IB always notices before the broker does.

Disputes in multi-tier IB programmes

Disputes in IB networks usually fall into three types:

1. Attribution. Two IBs both claim the same client.
2. Hierarchy. A sub-IB wants to leave their master and deal with the broker directly, or move to another master.
3. Calculation. An IB believes their commission or override was calculated wrongly.

Put the rules in the agreement before any of these happen. Who owns a client if two links were used? Can a sub-IB change master, and if so, what happens to existing clients and to the master’s override? How long does an IB have to query a statement, and how quickly will you respond?

A reasonable rule for hierarchy disputes: a sub-IB may move, but the master keeps the override on clients introduced while the sub-IB was under them, for an agreed tail period. That protects the master’s work without trapping the sub-IB. Our IB agreement checklist lists the clauses to cover.

Reporting that sub-IBs can verify

Transparency is what makes the broker-paid override model work. Each IB should see:

• every client attributed to them, with registration date and status
• deposits, lots traded per instrument and the commission earned on each
• for masters, each sub-IB’s totals and the override earned, without client personal data the master isn’t entitled to
• payout history, holds and any clawbacks, with the reason

Sub-IBs should be able to reconcile their statement against what their clients tell them they traded. If they can’t, they’ll assume they’re being shortchanged, whether or not they are. Clear reporting is cheaper than any dispute.

Also watch how masters and sub-IBs promote you. A master is responsible for overseeing sub-IB marketing, but the broker’s licence is what’s at risk. Every IB in the tree must market only where your licence allows, include appropriate risk warnings (leveraged trading carries a high risk of loss) and follow local rules, such as Saudi Arabia’s Mawthooq licence requirement for paid promotional content.

Questions brokers ask

What is an IB override?

It’s the commission a master IB earns on the clients of sub-IBs they recruited. It’s usually a fixed amount per lot or a percentage of the sub-IB’s commission or the client’s revenue.

Should the master IB set the sub-IB’s rate?

Ideally not. The broker should agree the sub-IB’s rate directly in a visible agreement and pay the master’s override separately. That avoids hidden splits and the disputes they cause.

How many tiers should a multi-tier IB programme have?

Two is the cleanest. Three can work with small overrides at the third level. More than that is hard to track and can look like a recruitment scheme.

What happens if a sub-IB wants to leave their master?

The agreement should say. A common approach lets the sub-IB move while the master keeps the override on existing clients for an agreed period.

We help brokers design master IB and sub-IB programmes and introduce them to established networks. See our IB and affiliate network service, or get in touch if you’d like to talk it through.