How to Reduce Your Betting Exchange Commission

Being a Matched Bettor means focusing on making as much money as possible. Sure, you will have to make some initial investments in order to get your adventure started, but you don’t want to spend too much money as it can have a bad impact on your overall profits.

One of the ways you can minimise your Matched Betting expenditure is by reducing the commission at the Betting Exchange you’re using. In this article, we are going to show you how it’s done.

Recommended to Read Next: What Is the Betfair Betting Exchange?

3 Key Takeaways:

  1. Betting Exchanges make their money by charging a commission.
  2. There is a way to reduce the commission at some betting exchanges.
  3. Even with a seemingly high betting exchange commission, Matched Bettors still make nice profits.

Betting Exchange Commissions Explained

You can get the most out of Matched Betting if you add a Betting Exchange to the equation. The exchange is where you can lay a bet that you’ve bet on at the Bonus Bookmaker. This way, no matter the outcome, you’re going to win money.

How Betting Exchanges work is that they let you assume the role of a bookmaker, letting you bet against other players. This means that Exchanges have no interest in whether your bet is going to win or lose.

Instead of hoping that the players are going to lose their money, they have a different business philosophy. Betting Exchanges make their money by charging a commission.

Depending on the betting exchange you decide to use, you might need to pay them a fee, not only on winnings but also on losing bets as well. Sometimes, the commission can be pretty hefty, which is why we at Oddshero advise you to stick to the best Betting Exchanges, such as Betfair, Matchbook and Smarkets. You can make bets at all of these exchanges by using a single account at a betting brokerage (a.k.a. betting broker) such as Sportmarket and BetInAsia also.

The best thing about these betting exchanges is that they reward their customers with reduced commissions. We’re now going to teach you how to get ahold of such deals.

How to Reduce Your Betfair Commission?

How to Reduce Betfair Commission

Betfair decides its commission depending on the location of the player and their Discount Rate. It can be anywhere from 2% to 7% on winning bets. Obviously, you want your commission to be as low as possible, so the question is how are you supposed to reduce it? To figure this out, first you need to learn how the commission structure of Betfair Exchange works.

The formula used for calculating the commission percentage is:

Market Base Rate x (1 - Discount Rate) = Commission Percentage

The term “Market Base Rate” depends on the place where you live. It can be 5% (UK, Ireland, Italy, Gibraltar, and Malta), 7% (Albania, Armenia, Croatia, Monaco, Serbia, Montenegro, and Slovakia) or 6.5% (rate for all other countries accepted by Betfair).

What’s left is to explain what “Discount Rate” means in this equation. It’s a discount that can significantly reduce your commission. The highest Discount Rate available is 20%. However, in order to get it, you need to collect as many Betfair Points as possible.

To do that, you need to keep on placing bets at Betfair Exchange. The more bets you place, the more Betfair Points you will earn, which is actually great news for Matched Bettors who tend to place a high volume of lay bets on a regular basis.

Betfair Points are awarded both when you win and when you lose. In the first case, the number of Points is calculated according to your current commission – you will get 1 Point for 20 cents charged. When it comes to losing bets, the number of Points is decided according to the implied commission, which is basically the amount you would have to pay if your bet was a winning one.

Betfair Discount Rate Structure

  • 1000 Betfair Points = 2% Discount Rate
  • 2500 Betfair Points = 4% Discount Rate
  • 4000 Betfair Points = 6% Discount Rate
  • 5500 Betfair Points = 8% Discount Rate
  • 7000 Betfair Points = 10% Discount Rate
  • 9000 Betfair Points = 12% Discount Rate
  • 11000 Betfair Points = 14% Discount Rate
  • 13000 Betfair Points = 16% Discount Rate
  • 15000 Betfair Points = 18% Discount Rate
  • 17000 Betfair Points = 20% Discount Rate

Even if you get the highest Discount Rate available, which is 20%, it doesn’t mean that you will get your commission reduced by one-fifth. In fact, the lowest commission a player can get is 4%.

This is possible only if you are a player from a country where the Market Base Rate is 5%, and you have collected over 20,000 points, so that your Discount Rate is 20%.

To make sure you properly understand what we’re talking about, here’s an example. Let’s say you’re a player from the UK (5% Market Base Rate) who has the maximum Discount Rate. In this case, the formula goes like this:

5 x (1 - 0.2) = 4%

*0.2 in this equation refers to the 20% Discount Rate, only presented in decimal form.

How to Reduce Your Smarkets Commission?

How to Reduce Smarkets Commission

Once you sign up to the Smarkets Exchange, your commission is going to be 2%, which is lower than what Betfair charges. The best thing is that you can reduce the Smarkets commission even further. There is a way to qualify for a commission of only 1%. The bad news is that it’s not easy to get there.

The players who belong to the so-called Pro Tier get to pay only 1% commission. However, in order to become a Pro Tier player, you need to have wagered over 1 million Euros. Alternatively, you can get the reduced commission if you make more than 1500 bets over a period of one month.

It may sound like a difficult milestone to achieve, but professional bettors make way more bets than 1,500. Value Bettors, for instance, place a few hundred bets every week. But, what about Matched Bettors?

Well, there are more than 65 Bonus Bookmakers available at Oddshero and each of them is giving away bonuses that come with wagering requirements. What this practically means is that you will have to place hundreds of bets to clear those bonuses.

Once you’re done with that, you can do Value Betting with Trademate Sports, a tool that will supply you with hundreds of value bets on a regular basis. Furthermore, you can take Matched Betting for another round by getting your friends and family members involved. They can use your Smarkets account to get a reduced commission.

How to Reduce Your Matchbook Commission?

How to Reduce Matchbook Commission

Same as Betfair Exchange and Smarkets, Matchbook also makes money by charging a commission. However, unlike the other two, the commission structure of Matchbook is much easier to understand. In fact, there are only two options – you either pay 2% or 4%.

Unfortunately, there isn’t much you can do to change this as the commission rate depends on your location. The players based in the United Kingdom, Republic of Ireland, and Isle of Man are charged a 2% commission, both on winning and losing bets. Players located in other parts of the world pay a 4% fee.

The Impact of Commission on Your Matched Betting Profits

The whole point of being a Matched Bettor is to be able to earn as much money as possible on a pretty small investment. Before you start with Matched Betting, you need to allocate some funds for making bets, as well as paying a subscription for your Matched Betting software.

That’s about it when it comes to the money you need to invest to launch your Matched Betting campaign. Paying a commission to the Betting Exchange, however, is something that will keep coming back to haunt you. You will always have to give away a percentage of your profits to the betting exchange. Note: You do not have to use a Betting Exchange to do Matched Betting.

The good news is that the fee you will have to pay is not that big. Actually, the amount is so tiny you’re probably not going to notice it. Furthermore, only Betting Exchanges charge commissions, bookmakers don’t do the same. What this means is that you’re not going to have to pay the commission every time.

In addition, when you lose your lay bet at the Betting Exchange you will not have to pay anything, although this is something that depends on which Exchange you decide to use. Betfair, for example, does not charge a commission on losing bets. Still, even if you decide to go with a Betting Exchange that charges a fee on every lost bet, it’s not going to influence your profits significantly.

Let’s say you’re going to use Betfair for the purpose of Matched Betting and that your commission rate is 5%. If you win a net profit of €100, you’re going to have to pay €5 to the exchange. Not much, you must agree, especially since you’ve invested much, much less for your Matched Betting strategy.

On top of that, you’re only going to have to pay the fee when your layed bets win. You are not going to be charged anything when your Bonus Bets win.

Key Takeaways

  1. All Betting Exchanges charge commission to the players, which is not the case with Bonus Bookmakers.
  2. Some Betting Exchanges have commission schemes that allow the players to reduce the commission rate.
  3. Even if it seems high, the betting exchange commission will not reduce your Matched Betting profits significantly.

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