iFX EXPO International 2023: TFB CEO Alexey Kutsenko discusses the industry transition beyond MT4 and MT5

Through engaging interviews, we uncovered insights, perspectives, and experiences, shedding light on the latest trends, developments, and challenges within this rapidly evolving industry.

Today, we are thrilled to have the exclusive opportunity to conduct an in-depth interview with Alexey Kutsenko, Founder and CEO of Tools for Brokers (TFB), an international technology provider for retail brokers, prop trading companies, and hedge funds.

Nikolai Isayev, the Editor-in-Chief of FinanceFeeds, kickstarted the conversation by shining a spotlight on TFB’s recent liquidity-bridging partnership with FXCM Pro. This noteworthy collaboration allows FXCM Pro to provide institutional liquidity to clients, thus upgrading their pricing and trading capabilities across MT4 and MT5 platforms via TFB’s FIX API server. Nikolai delved deeper, seeking insights into the importance of liquidity bridge solutions for FX brokers and exploring potential alternative avenues.

Alexey Kutsenko highlighted the critical role of liquidity bridges in the FX industry, likening them to the core of a brokerage’s business operations. He explained that these bridges are essential for seamlessly connecting various aspects of a broker’s function. Alexey further spoke about the importance of continually expanding their bridge solutions by collaborating with top-tier liquidity providers. This expansion enables clients to offer a wide range of assets and exchanges to their customers, adapting to the evolving financial markets. He cited the example of cryptocurrencies, which have become integral to the financial industry, highlighting the need for liquidity bridge solutions to remain indispensable and adapt to changing market needs, including the potential addition of new instruments like equities.

During the interview, we highlighted the influence of customer feedback on TFB’s partnerships and expansions and asked Alexey Kutsenko to elaborate on how client feedback specifically shapes these decisions.

Alexey Kutsenko affirmed the importance of customer feedback in their decision-making process. He explained that they actively gather feedback from both existing and potential clients. When they observe consistent demand for a specific type of asset or liquidity, it triggers discussions with potential partners. These discussions aim to explore opportunities for integration and establish favorable conditions for clients. In essence, customer feedback serves as a critical driver in shaping TFB’s partnerships and expansion strategies.

Moving on, Nikolai prompted a discussion about the evolution of the types of brokers that Tools for Brokers (TFB) caters to over time. He asked the founder to provide insights into the changes in the broker landscape and client needs.

TFB CEO shared that there have been game-changing shifts in the brokerage industry landscape. He noted that the space is now more heavily regulated, and most platforms have some level of regulatory oversight. This approach has driven brokers to place greater importance on risk management systems and liquidity solutions.

Alexey also highlighted a growing trend in demand for prop trading solutions, indicating a shift in how brokers attract clients. Prop trading has emerged as a new focal point, akin to the popularity of social trading five years ago. In summary, while the core concept of brokers remains similar, the industry has become more complex and professional over the years, with evolving trends like prop trading gaining prominence.

In the context of liquidity bridges, we inquired about Tools for Brokers’ plans regarding the addition of more trading platforms to their offerings, given the evolving landscape beyond MT4 and MT5, with platforms like cTrader and Match-Trade gaining traction.

Alexey confirmed their commitment to adapting to market demands and highlighted the flexibility of their Trade Processor. He explained that their flagship product was originally designed to be highly integrable with various trading platforms. They respond to client requests and market trends by gradually adding new trading platforms. Currently, there is a growing demand for platforms like cTrader and Match-Trade, and their Trade Processor can easily accommodate these. Alexey also mentioned the increasing demand for new trading platforms in white-label configurations.

While MT4 and MT5 remain essential, Tools for Brokers is always ready to integrate new platforms. They can seamlessly integrate proprietary trading platforms used by some brokerage companies, providing them with the full capabilities of their Trade Processor.

Given the wide range of add-ons and tools in the TFB ecosystem, we were curious to know about the compatibility issues with existing systems, trading platforms, or brokers and how these challenges are addressed.

Alexey acknowledged the importance of compatibility in the evolving brokerage industry. He explained that when they integrate a solution, it typically goes smoothly in about 95% of cases. However, there’s always a small percentage where potential issues might arise due to differences in software, platforms, or plugins. To tackle this, TFB conducts comprehensive testing of all their solutions for compatibility within their ecosystem. They also engage in close collaboration with other companies in the industry and have agreements to test their software with theirs.

Alexey added that for brokerage companies, it’s crucial that every component of their environment is compatible with others, especially in an industry that’s becoming more complex and professional. Tools for Brokers places a strong focus on ensuring compatibility and has a dedicated technical team committed to making sure their solutions work harmoniously within a broker’s environment, meeting their evolving needs.

Within the same context, we asked about Tools for Brokers’ approach to customer support, particularly considering their multilingual clients located in different regions.

Alexey described customer support as a standout feature of their company, often considered one of the best in the industry. Their approach goes beyond providing technical answers; their support team consists of engineers who actively engage with clients to understand their needs and implementation requirements. They take control of the client’s environment, identify issues, and offer guidance on the correct configuration.

Alexey also highlighted their substantial investment in the education of their support team. As he states, every new employee, including support staff, undergoes specialized training within the company and must pass an internal exam before interacting with clients. This rigorous training ensures that the support team understands industry principles, their solutions, and the technical aspects involved.

Recognizing the diverse regions they operate in, TFB provides support in multiple languages, with employees who can communicate with clients in various regions. They offer 24/7 support to meet industry demands and even have a dedicated team for updates and installations during weekends to minimize disruptions.

It was impressive to hear that Tools for Brokers’ support team includes engineers who can effectively communicate with customers. So we asked Alexey Kutsenko to elaborate on how this technical expertise benefits their clients.

Alexey Kutsenko explained that within their company, they refer to it as customer engineers as they hire individuals with a technical background for this role. This approach allows their specialists to converse in the same technical language as their clients, enabling them to provide more than standard support. Instead of offering scripted responses or basic troubleshooting, TFB representatives can delve deeper into the technical aspects of the issue. This results in more effective problem-solving and an overall improved experience for their clients, as they receive more specialized and insightful assistance.

FinanceFeeds sought more details about the purpose and difficulty level of the exam that new employees at Tools for Brokers are required to take.

Alexey clarified that the purpose of the exam is to ensure that new team members are adequately prepared to work with clients. While the exam is not overly difficult, it serves as a way for the company to assess a candidate’s knowledge and readiness. If a candidate doesn’t pass the exam, they are encouraged to spend a week addressing any gaps in their understanding. Essentially, the exam is a tool to help Tools for Brokers identify whether a new team member possesses the skills required to effectively engage with clients and avoid asking basic or uninformed questions.

Before wrapping up this interview, Nikolai Isayev raised the question of the main challenges that brokers might face in light of the current subdued volatility in the financial markets as we approach the end of 2023 and look ahead to 2024.

Alexey pointed out that in an environment of low volatility, brokers encounter the challenge of generating revenue. He highlighted a growing interest in prop trading solutions as a means of income that isn’t solely dependent on trade volume but also relies on fees and client participation. Furthermore, brokers may explore opportunities in new regions to expand their client base. Emerging markets like Latin America, Mexico, South Africa, and New Zealand have gained attention. Alexey stressed the importance of brokers being quick to adjust to emerging markets, ever-changing trends, and inventive approaches to attracting clients in order to effectively steer through phases of reduced market activity.