LeapRate Unique… LeapRate has discovered that main on-line FX and CFD dealer Plus500 Ltd (LON:PLUS) has determined to halt its Revshare funds with associates in its 500Associates.com program forward of MiFID II rules, transferring as a substitute to an all-CPA (cost-per-acquisition) mannequin.
Whereas most associates of FCA and CySEC licensed Plus500 have been working with the CPA mannequin so far, receiving a price from Plus500 for every new consumer they consult with the dealer, many associates selected as a substitute to obtain a portion of the unfold income Plus500 earns over time from the referred purchasers, referred to as Revshare. Numerous associates additionally work on a hybrid small-CPA-payment plus Revshare mannequin.
The change to all-CPA takes impact at Plus500 as of January 1, 2018.
The explanation for the change is new MiFID II rules which EU licensed brokers might want to observe, which kick in as of January three, 2018. MiFID II permits associates to obtain Revshare funds from brokers, however solely below sure circumstances, reminiscent of when the consumer continues to obtain some form of tangible profit from the affiliate. The rule was put in place by EU regulators to stop monetary associates from aggressively encouraging the purchasers they consult with deposit and churn their accounts.
Brokers reminiscent of Plus500 can proceed to supply Revshare below the brand new MiFID II imposed circumstances, however we imagine it is going to be incumbent upon the dealer to then by some means monitor the exercise of the affiliate, and make sure that the Revshare requirement guidelines are being adopted – one thing which might be very tough to do, and which might open the dealer to issues down the street.
LeapRate has discovered that for the previous 4 months already Plus500 has solely been signing up new associates to the CPA mannequin, and is now transferring over its present Revshare and hybrid associates to CPA as effectively.