Bonus types: credit versus cash
A forex bonus can arrive as credit you cannot withdraw, as a bonus withdrawable after conditions, or as cash. How to tell them apart in the terms.
Published ・ MyBrokerBonus Editorial
Two offers can both be called a “bonus” and still be different things. One is credit that you can only use as margin and can never withdraw. Another can be withdrawn once you meet conditions. A third is paid as cash. This article explains how to tell them apart by reading the terms. The bonuses are offered by each broker, not by this site. Rates and amounts are not written in the text, because brokers can change them.
Three questions to ask first
| Question | Answers you will meet | Where to read it |
|---|---|---|
| 1. When does it come? | With no deposit / by depositing / as a result of trading or joining | The name of the offer and how to claim it |
| 2. What is added? | Credit / withdrawable after conditions / cash | The sentence on withdrawing the bonus |
| 3. What about the profit? | Free / after conditions / limited / the account ends | The sentence on withdrawing the profit |
Question 1 and question 2 are decided separately. A deposit bonus can be credit, and it can be withdrawable.
The name of an offer does not tell you what you get. Put three questions to the terms. The first, “when does it come?”, separates a no-deposit bonus (no deposit needed), a deposit bonus (it depends on your deposit) and perks that follow trading or joining, such as cashback or a contest prize. The second, “what is added?”, is the main subject of this article.
The first and second questions are decided separately. A deposit bonus can be credit that cannot be withdrawn, and it can also be a bonus that can be. The next sections read the terms themselves.
Three forms a bonus can take
Credit
It works as margin for trading. The profit made with it is a separate question.
Withdrawable after conditions
Both the bonus and the profit can come out, but moving money early can remove what is left.
Cash
It is paid as funds you can withdraw or trade with, for example a cashback.
Which form an offer takes is written in its own terms. The same name can mean different forms at different brokers.
In short there are three forms: credit, a bonus you can withdraw after conditions, and cash. Which one applies is written in the terms of each offer.
Form 1: credit
Credit can be used as trading funds (margin), but the bonus itself cannot be withdrawn. Both no-deposit bonuses and deposit bonuses can take this form.
A no-deposit example:
The NDB is non-withdrawable and may be used as margin for trading purposes only.
AXIORY, official page
What it means. The bonus cannot be withdrawn, and the only thing it can be used for is margin when trading.
A bonus tied to a top-up:
The Top-up Bonus cannot be withdrawn under any circumstances.
HFM, official page
What it means. The bonus itself cannot be withdrawn in any case. This sentence says nothing about the profit, which is the next question.
Profit made with credit is decided separately
Even when the credit cannot be withdrawn, the profit made by trading with it may be withdrawable. The bonus and the profit are treated separately.
The credit that is added
It is for trading. The terms say it cannot be withdrawn.
The profit made with it
Some terms set no condition, some ask for volume or a first deposit, and some set a limit on the amount.
Read the sentence on withdrawing profit in the terms to see which type an offer is.
The same HFM terms say this about profit:
Profits created from the Top-up Bonus can be withdrawn with no restrictions.
HFM, official page
What it means. The profit made with the bonus can be withdrawn, and this sentence adds no conditions to that.
Other brokers attach conditions to the profit. AXIORY says profit from the bonus credit becomes withdrawable after its unlock conditions are met. HFM’s demo contest terms say that when profits are withdrawn the prize amount is deducted from the live account, which is then archived. For the usual shape of a no-deposit bonus, see What is a no-deposit bonus?.
Form 2: a bonus you can withdraw after conditions
Some offers say the bonus itself can be withdrawn. Milton Markets describes its deposit bonus this way:
This is a withdrawable bonus, meaning both the bonus amount and any profits can be withdrawn after you meet the stated conditions.
Milton Markets, official page
What it means. After the conditions are met, both the bonus amount and the profit can be withdrawn. This sentence alone does not say what the conditions are.
But a bonus that can be withdrawn is treated differently if you move money early. The same terms say:
If you transfer funds out of the bonus account or request a withdrawal before meeting all conditions (90 days + lot requirements), any remaining bonus that has not met the conditions will be removed.
Milton Markets, official page
What it means. If you move funds out or ask for a withdrawal before the holding period and the lot requirements are both met, the part of the bonus that has not met them is removed. A “withdrawable” bonus can be withdrawn only after the conditions are met.
Form 3: cash
A cash form shows up in some prizes and in cashback. Traders Trust’s Cashback Rebate is a daily rebate based on the lots you trade. Its page says the cashback is paid as real funds that can be withdrawn or traded at any time, with no withdrawal limit on cashback funds. HFM’s traders awards page calls its prize a cash prize. Whether a given perk really is cash depends on its own terms, so check the sentence about withdrawal.
A prize or a reward is not always cash
A name such as “prize” or “reward” does not make something cash. The terms of HFM’s demo contest say:
The prize funds cannot be withdrawn but any profits can be withdrawn as long as the winner(s) has completed at least 50 round turn trades and a total volume of 10 standard lots.
HFM, official page
What it means. The prize money credited to the account cannot be withdrawn. Profit can be withdrawn only after the trade count and the volume in the sentence are both reached.
JMarkets pays its welcome rewards as points called JUSD. Its terms say JUSD cannot be exchanged for real USD or any other currency and cannot be used for withdrawals or as margin for trading. So JUSD is neither cash nor credit. Judge by the withdrawal sentence, not by the name.
Withdrawing also has its own sentence
Even once the form is clear, the terms say separately what happens to the bonus when you withdraw. For its Top-up Bonus, HFM says the bonus is removed in proportion to the share of the amount withdrawn. AXIORY says that if you withdraw deposited funds before both unlock conditions are met, all remaining credit is removed and any profit made only with the bonus is set to zero.
Everything is removed
The remaining credit and the bonus-only profit are removed.
Removed in proportion
Only the matching share of the bonus is removed.
The numbers are made up to show the difference. They are not any broker's terms.
Caution
Even a bonus described as withdrawable can be removed if you move funds before the conditions are met. Before you claim one, read both the sentence on withdrawing and the sentence on withdrawing too early.
What to check in the terms
- Can the bonus itself be withdrawn? Look for wording such as “cannot be withdrawn”, “margin only” or “withdrawable”.
- Can the profit made with it be withdrawn? See whether there are conditions, a limit, or an account that ends.
- What happens if you withdraw before the conditions are met? Some terms remove everything, and some remove a share.
- What a “reward”, “prize” or “point” really is. Cash, credit, or something that cannot be exchanged: the sentence on withdrawal tells you.
- How to claim it, the deadline and who is eligible. Your country or account type can make you ineligible.
For how to read a withdrawal sentence, see How to read bonus withdrawal conditions. To compare deposit bonuses, see Deposit bonuses compared. For contests that pay prizes, see Forex demo contests and trading contests. To see how credit appears on the trading screen, see How bonus credit looks in MT4 and MT5.
Risks to keep in mind
Trading with leverage can lose money quickly. Using a bonus does not remove the loss on a trade. Credit can be used as trading funds, but it can be used up and leave nothing. Even a bonus that can be withdrawn cannot be withdrawn if the conditions are not met. This article does not recommend any broker. Always read the full terms from the provider before you apply, and only trade with money you can afford to lose.
