Not all forex bonuses work the same way. The most important distinction in any bonus offer is whether you are receiving credit or cash — and most traders do not understand the difference until it matters. A credit bonus adds margin to your account but cannot be withdrawn. A cash bonus deposits real money that can eventually become yours. This single distinction changes how the bonus affects your trading, your withdrawals, and your actual account value.
This guide breaks down both types, explains how each one works in practice, and helps you determine which type of bonus offer delivers real value for your trading situation.
For a broader overview of how all forex bonuses work, start with our complete forex bonus guide.
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What Is a Credit Bonus?
A credit bonus adds non-withdrawable trading credit to your account. The credit increases your available margin — allowing you to open larger positions or absorb more drawdown — but it never becomes real money you can take out. When you close your account or withdraw your deposit, the credit disappears.
Think of it like a store credit card with a limit that lets you buy more, but the credit line itself is never converted to cash.
How credit bonuses work in practice
When you receive a credit bonus, your account shows two figures: your real balance (deposited funds plus or minus trading results) and your credit (the bonus amount). Your usable margin is the sum of both. Here is a concrete example:
- You deposit $500
- The broker adds $500 in credit bonus (100% match)
- Your equity shows $500, your credit shows $500, your usable margin is based on $1,000
- You trade and make $300 in profit
- Your equity is now $800 ($500 deposit + $300 profit)
- The $500 credit is still non-withdrawable
The credit serves one function: it increases your margin capacity. It does not add to your balance. It does not count as equity for profit/loss calculations on most platforms. And when you withdraw your funds, the credit is removed.
When credit bonuses disappear
Credit bonuses are typically removed when any of the following happens:
- You make a withdrawal of any amount
- You fail to meet the lot requirements within the time limit
- Your account equity drops below a specified threshold
- You close or archive your account
Some brokers have a more nuanced approach: partial withdrawals reduce the credit proportionally. Withdraw 50% of your deposit, and 50% of the credit is removed. Others follow an all-or-nothing rule — any withdrawal cancels the entire credit.
What Is a Cash Bonus?
A cash bonus deposits actual funds into your trading account. Unlike credit, this money can eventually be withdrawn — but only after you meet specific conditions, typically a lot (volume) requirement and sometimes a time limit.
Cash bonuses are less common than credit bonuses because they represent a higher cost to the broker. When a broker offers a cash bonus, they are putting real money on the line.
How cash bonuses work in practice
With a cash bonus, the funds are added directly to your account balance:
- You deposit $500
- The broker adds $500 as a cash bonus (100% match)
- Your balance shows $1,000
- You trade and make $300 in profit
- Your balance is now $1,300
- After meeting volume requirements, you can withdraw everything — the $500 deposit, the $500 bonus, and the $300 profit
The critical difference: with a cash bonus, the bonus amount itself is part of your real balance. It participates in profit and loss. It counts as equity. And once conditions are met, it is withdrawable.
Cash bonus conditions
Because cash bonuses carry higher risk for the broker, the conditions tend to be stricter:
- Higher lot requirements per dollar of bonus compared to credit bonuses
- Tighter time limits — you may have 30 days instead of 90
- Profit caps — some brokers limit the maximum profit you can withdraw from a cash bonus
- Deposit lock — withdrawing your deposit before meeting conditions may cancel the bonus and any profits from it
For a detailed breakdown of how deposit bonus terms work, see our guide on deposit bonus terms explained.
Credit vs Cash: Side-by-Side Comparison
| Feature | Credit Bonus | Cash Bonus |
|---|---|---|
| Added to your balance | No — separate credit line | Yes — part of real balance |
| Withdrawable | Never (credit itself) | Yes, after meeting conditions |
| Affects your margin | Yes — increases usable margin | Yes — increases balance and margin |
| Counts as equity | Usually no | Yes |
| Participates in P&L | No | Yes |
| Removal on withdrawal | Usually removed (full or partial) | May be locked until conditions met |
| Typical lot requirements | Moderate | Higher |
| Risk to broker | Lower | Higher |
| How common | Very common | Less common |
How Each Type Affects Your Trading
Margin and position sizing
Both bonus types increase your available margin, but they do it differently. A credit bonus adds a separate margin buffer that lets you open bigger positions or sustain larger drawdowns. A cash bonus increases your actual balance, which has the same margin effect but also means the bonus money is at risk in your trades.
With a credit bonus, if a trade goes against you, your real equity absorbs the loss. The credit provides margin room but does not cover losses. With a cash bonus, losses are spread across the combined balance — the bonus money absorbs losses alongside your deposit.
Withdrawal planning
This is where the distinction matters most. If you plan to trade, make a profit, and withdraw — the bonus type determines what you actually take home.
With a credit bonus, your withdrawable amount is only your deposit plus or minus trading results. The bonus credit never converts to cash. Your withdrawal triggers credit removal, so you need to be strategic about when you pull funds out.
With a cash bonus, your withdrawable amount (after meeting conditions) includes the bonus itself plus profits. But be aware: withdrawing before meeting conditions typically cancels the bonus and may cancel associated profits too.
Risk profile
Credit bonuses can create a false sense of security. Your account appears to have more capital than it actually does, which can encourage larger position sizes than your real deposit supports. If the credit is removed (due to a withdrawal or expiry), your margin level drops suddenly — potentially triggering margin calls on open positions.
Cash bonuses carry a different risk. Because the bonus is part of your real balance, losses consume it. If you lose the bonus funds through trading, they are gone. With a credit bonus, you cannot “lose” the credit — it is removed by the broker, not by the market.
Which Type Is Better?
There is no universal answer. The better bonus type depends on your situation.
Credit bonuses are better when:
- You want extra margin capacity without additional withdrawal complexity
- You plan to trade long-term and do not need to withdraw the bonus
- You want a buffer against margin calls on open positions
- The lot requirements on the cash alternative are unrealistically high
Cash bonuses are better when:
- You want the possibility of withdrawing the bonus itself
- The lot requirements are achievable through your normal trading
- You are confident you will meet the conditions within the time limit
- You want the bonus to count as real equity in your account
For most traders — especially those new to bonuses — the type matters less than the conditions. A credit bonus with fair lot requirements from a regulated broker is worth more than a cash bonus with impossible conditions from an unregulated one. Our deposit bonus hub compares current offers with their terms so you can evaluate what is actually on the table.
How to Identify Which Type a Broker Offers
Marketing pages often do not make the distinction clear. Here is how to find out:
- Check the terms and conditions document — not the landing page. Look for language like “bonus credit,” “non-withdrawable credit,” or “trading credit” (indicates credit bonus) versus “bonus funds,” “withdrawable bonus,” or “bonus deposited to balance” (indicates cash bonus).
- Look at how the bonus appears in the platform. Credit bonuses typically show in a separate “Credit” field in MetaTrader 4/5. Cash bonuses appear directly in the “Balance” field.
- Ask the broker’s support. A direct question — “Is the bonus added to my balance or as separate credit?” — gets a definitive answer.
All bonus types for brokers listed on this site are documented in our Broker & Bonus Matrix. We verify whether each offer is credit-based or cash-based as part of our standard review process.
Frequently Asked Questions
Can a credit bonus turn into a cash bonus?
In rare cases, yes. Some brokers structure their credit bonus so that after meeting specific volume requirements, a portion of the credit converts into withdrawable funds. However, this is uncommon. In most cases, credit bonuses remain non-withdrawable regardless of how much you trade. Always confirm the conversion terms before assuming the credit can become cash.
If I lose money trading with a credit bonus, do I owe the broker?
No. A credit bonus does not create a debt. If your real equity reaches zero, your positions are closed through the broker’s margin call process. The credit is removed, and you owe nothing beyond what you deposited. Negative balance protection (offered by most regulated brokers) prevents your losses from exceeding your deposit.
Why do brokers offer credit bonuses if they cannot be withdrawn?
Because credit bonuses are cheaper for the broker. They provide margin capacity without the broker giving away real money. The increased margin encourages traders to open larger positions, which generates more spread and commission revenue. It is an effective marketing tool with a controlled cost.
Should I avoid credit bonuses entirely?
Not necessarily. A credit bonus from a regulated broker with reasonable terms provides genuine value — extra margin capacity at no cost to you. The key is understanding that the credit itself is never yours. If you trade profitably, you keep the profits. The credit just gave you more room to work with. Problems arise only when traders treat credit as real money or when brokers use credit removal as a tool to trigger margin calls.
⚠️ Risk Warning: Forex and CFD trading carries significant risk. Most retail traders lose money. Never trade with funds you cannot afford to lose.
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Written by Tim Morris · Forex industry analyst · About Tim