The stock market is a powerful concept that allows individuals to invest in hypothetical wealth, wealth that can fluctuate wildly due to market forces. But the stock market has done more than just allow successful investors to enrich themselves, it has also led to the rise of numerous ancillary professions that facilitate these investments, one of which is the sub-broker.
Who Is a Sub-broker?
Since an individual cannot directly invest in stocks and shares, they need to do it via broking firms. The brokers that are part of these firms are authorised to trade and exchange shares on behalf of the individual or even an institution. However, there is a dwindling number of authorised brokers to acquire services from and in order to ensure that there is efficient match making between prospective investors and traditional brokers, the class of sub-brokers was created. A sub-broker acts on the behalf of a Trading Member of a Stock Exchange, and brings in clients that eventually go on to invest via the broker, enhancing their returns from their brokerage fees.
Read more at What is a Sub-broker?
What Is a Sub-broker Program?
A sub broker program is also known as a stock broking franchise. It requires two aspects: a registered sub broker and a stock broking house. The concept is to create business opportunities for those who cannot get a broking license as they are challenging to get, and expensive as well. Through a sub broker program, a larger broking house gives their franchise to a smaller non-trading member brokerage house. Once the relationship is cemented through the required paperwork, the interaction between the two is regulated by the SEBI. Once the contract is completed, the sub broker has the right to start their own broking business as they wish.
What Is the Sub-broker Program of IIFL?
The sub broker business model is straight forward. A sub broker is required to build on their clientele and create new relationships to bring in new clients. The brokerage created by the clients is then broken up between the sub broker and the larger broking company. Contrary to what one may believe, the sub broker is the one who earns the larger sum from the brokerage generated.
There are different kinds of relationships that can occur within a sub-broker business model. Within the IIFL partner program, there are four main outcomes:
This is a good option for those who are aiming to occupy a much larger space in equity markets. Entrepreneurs can create their own office and hire a staff to build on the services they offer to their clients as they grow.
The advantages that come with this relationship are many:
– Scope for business development and growth
-Support provided by the broking firm while on-boarding clients
-Higher revenue sharing along with a consistent revenue generation
-Services and products can be catered as per the clients’ needs
-Support with marketing the sub brokership both online and offline
-State of the art risk management
This is for individuals who can create a relationship with the brokerage firm and earn through the revenue generated, via their association with the same. No capital investment is needed for this. Anyone with a background in financial services who aims to grow their business can opt for this.
Similar to the franchisee option, this too has its own advantages
– No capital investment is needed
– The offers are based on the clientele that one has
– Support with clients, marketing, and risk management
– Revenue generated is consistent
– The association made with the well-established brand identity of IIFL
Employee to Entrepreneur
For those who are currently employed with a business however, they aspire to have their own business and go from employee to entrepreneur, this option works best for them. Anyone who has worked in the capital market with a financial services background is eligible to opt for this.
The advantages with the business model are as follows:
– The employee can be their own boss as they grow
– No capital investment is required
– The business they wish to create can be molded as per their expertise
– Support with clients, marketing, risk management, and of course services that fit the needs of the clientele
Remisier / Direct Sales Agent (DSA)
This business model is ideal for anyone who works as an independent individual however, they continue to refer clients with respect to brokerage as well as other investment options when they partner with IIFL. There are no eligibility criteria other than having a good connection to refer clients.
The benefits of this business model are:
– Every successful client recommendation earns the sales agent income
– No capital investment needed
– IIFL offers a number of services for which clients can be referred, which creates a vast and varied clientele.
The IIFL sub brokership program offers immense scope for growth at both an individual and business level. Not only does it offer a variety of services to a wide clientele, the image that IIFL has established for itself provides a boost for those associated with them. Whether it is an individual or someone who wishes to expand their business within this sector, the IIFL sub brokership program is beneficial in creating crucial relationships to build on their existing business..