How to Register with FINRA: Step-by-Step Guide for BDs
Sep 10, 2025
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14 min read
Contents
Becoming a broker-dealer in the US means going through a detailed application process, and for most firms, that starts with understanding how to register with FINRA. Whether you're starting a brokerage, building a trading platform, or offering a fintech product that involves securities, you’ll likely need a FINRA membership.
In this guide, we will walk you through the FINRA registration process, including what to prepare, how the review works, and what firms typically encounter along the way. We will also cover common mistakes, timing considerations, and key details that firms often overlook during the application process.
InnReg is a global regulatory compliance and operations consulting team serving financial services companies since 2013. If you need assistance with compliance or fintech regulations, click here.
Do You Need to Register with FINRA?
If your business involves handling securities transactions for clients or executing trades for your own account, you may fall under broker-dealer regulation.
Under federal law, any firm that engages in securities brokerage activity should register as a broker-dealer with the Securities and Exchange Commission (SEC) and apply for FINRA membership. This also extends to firms that may not identify as brokers, such as apps that direct trades, platforms receiving transaction-based fees, or businesses involved in private placements.
Key Requirements Before You Register with FINRA
Before you can apply to FINRA, your firm needs to meet several core requirements. These apply whether you're launching a traditional brokerage or a fintech platform that handles securities.
Minimum Personnel and Licensing
At a minimum, your firm should have two registered principals: one to oversee general supervision and one to manage financial and operational responsibilities. Each should pass the appropriate FINRA qualification exams. For most firms, this means a General Securities Principal (Series 24) and a Financial and Operations Principal (Series 27 or 28), depending on the business model.
If your team includes individuals who sell or advise on securities, they need to register as representatives and pass exams like the SIE and Series 7 or 79. All associated individuals should also file a Form U4 and submit fingerprints for background checks.
While FINRA allows a waiver of the two-principal rule in limited situations, these are uncommon and should be requested early in the process.
Net Capital and Financial Readiness
FINRA requires broker-dealers to maintain a minimum amount of net capital based on their business activities. This goes beyond a regulatory formality. It reflects your firm's ability to meet obligations, cover operating expenses, and manage risk from day one.
The baseline net capital requirement for an introducing broker that does not hold customer funds is typically $5,000. For firms that carry customer accounts or engage in proprietary trading, the amount is higher. FINRA may also require firms to hold additional capital beyond the minimum, especially if your projected expenses are high or your model involves unique risks.
Applicants should provide detailed financial projections, startup funding sources, and bank documentation to show that the required capital will be available before approval. FINRA then reviews these materials closely, including assumptions behind revenue forecasts and planned operating expenses.
Supervisory Procedures and Compliance Infrastructure
Every broker-dealer applicant should develop written supervisory procedures (WSP) that outline how the firm will supervise its business and comply with applicable rules. This document serves as the backbone of your compliance program and should align with your business activities, personnel structure, and risk profile.
FINRA expects the WSP to cover key areas such as sales supervision, communications, recordkeeping, cybersecurity, and anti-money laundering. It should clearly describe how the firm will oversee daily operations, address potential issues, and maintain internal review processes.
In addition to the WSP, your application should include a clear compliance structure. This means designating roles like Chief Compliance Officer and clearly identifying how supervisory responsibilities are assigned. FINRA often requests firms to revise and resubmit materials when submissions fail to include a practical, operational approach to compliance. Of course, this extends the review timeline.
Step-by-Step Guide on How to Register with FINRA
Once your firm is ready, the registration process begins. The steps below walk through each phase, from setting up your firm’s profile to receiving approval.
Step 1: Reserve Your Firm Name
Before you file anything with FINRA, you need to reserve your proposed firm name. This step helps avoid confusion with existing member firms and prevents names that could mislead the public or imply regulatory endorsement.
FINRA reviews your requested name for potential conflicts, restricted terms, or prohibited language. For example, names that include "National," "Federal," or "Advisor" may require additional approvals or supporting documentation. If your name suggests that you also operate as a registered investment advisor, you’ll need to be properly registered under that regime as well.
Submit the name reservation request through FINRA’s prescribed form, typically by email or fax. While this may seem like a small step, delays here can affect branding and marketing timelines, especially if you need to make changes based on FINRA’s feedback.
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Step 2: Set Up FINRA Gateway Access
To begin the application process, your firm should first gain access to FINRA Gateway, the system used to manage registrations, filings, and other regulatory submissions.
The process begins by appointing a Super Account Administrator (SAA), who will be responsible for managing system access for your firm. This individual should then complete and submit the New Organization SAA Form to FINRA. After the form is reviewed and accepted, FINRA creates your firm’s account and provides login credentials to the SAA.
Once you have access, the SAA can set up individual user accounts and assign appropriate permissions. From this point forward, all filings, including Form BD, Form NMA, U4s, and other documents, are submitted through this system. Without this access in place, the registration process cannot move forward.
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Step 3: Fund Your FINRA Flex-Funding Account
Before submitting your application, you should deposit the required application fees into your firm's FINRA Flex-Funding Account. You will use this account to pay for membership fees, filing fees, exam costs, and other regulatory charges throughout the application process.
The required deposit amount is often based on your firm’s size and the scope of its planned activities. However, FINRA provides a published fee schedule, along with an online calculator to help firms estimate what they’ll need to pay.
Most small to midsize applicants can expect a standard application fee between $7,500 and $15,000, with higher fees if the firm plans to carry customer accounts or perform additional functions. Payments are made by wire transfer or ACH, as FINRA does not accept checks for this account.
You’ll want to complete this step early in the process because the application fee must be fully funded before you can submit Form NMA or any related filings. Delays in funding can hold up the entire application.
Step 4: Prepare Your Application Package
Before submitting your application, you’ll need to assemble a complete package of documents for the New Member Application (NMA). This set of materials gives FINRA the information it needs to evaluate your firm’s business model, organizational structure, financial readiness, and compliance framework.
Key components include a detailed business plan, organizational chart, written supervisory procedures, financial projections, and any clearing or custodial agreements. If you are working with a third-party vendor for technology, recordkeeping, or trade execution, document those relationships as well.
FINRA uses this package to assess whether your firm meets its Standards of Admission. Incomplete or inconsistent submissions are a common reason for delays, so preparing a thorough and well-organized application helps move the review forward and demonstrates preparedness.
Step 5: File Form BD
Form BD is the required filing to register your firm as a broker-dealer with the SEC. It is submitted electronically through FINRA’s Web CRD system and includes information about your firm’s ownership, control persons, business lines, disciplinary history, and other relevant disclosures.
Once filed online, mail a signed and notarized hard copy to FINRA’s Regulatory Review and Disclosure Department. You can also request state registration through Form BD if your firm plans to operate in multiple jurisdictions. However, some states may have additional requirements, so it’s important to review those in parallel with your federal filings.
Step 6: Submit Form NMA and Supporting Docs
Form NMA is a core component of your FINRA membership application. It requires detailed information about your business model, supervisory structure, financials, and operational setup. FINRA uses this form to evaluate whether your firm is prepared to meet its regulatory obligations.
Along with the form, you’ll need to submit a complete set of supporting documents. These typically include your business plan, organizational chart, financial statements, and any agreements with vendors, clearing firms, or service providers. If your platform includes proprietary technology or online functionality, FINRA may also request a demonstration during the review.
Ensure your responses align with the Standards of Admission outlined in FINRA Rule 1014. If any elements are missing or unclear, FINRA may ask for revisions or follow-up materials.
Step 7: Register Individuals and Branches
Every individual at your firm who will function as a registered representative or principal should submit Form U4 through FINRA’s Web CRD system. This form collects personal, employment, and disciplinary history, and is required for all licensed personnel listed in your application.
At this stage, the individuals should also have passed the relevant qualification exams or be scheduled to do so within the allowed timeframe. In addition to individuals, you should register your office location using Form BR. This form designates your main office and any additional branches. Even if you have only one physical office, it must be properly registered. Each location should also list a designated supervisor.
Step 8: Submit Fingerprints
All individuals applying for registration with FINRA should submit fingerprints for background checks. This requirement applies to officers, directors, partners, and any other associated persons who need to be registered.
Fingerprints can be submitted electronically using an approved vendor or by mailing physical fingerprint cards to FINRA. The electronic method is typically faster and preferred by most firms. FINRA uses the fingerprints to check against FBI records and determine whether any disqualifying history exists.
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Step 9: Respond to FINRA Information Requests
After you submit your application, FINRA begins its review and may send written requests for additional information or clarification. These follow-up questions can cover any part of your submission, including business activities, supervisory procedures, financials, or personnel.
How you respond matters. Clear, prompt, and complete answers help move the process forward, while incomplete or inconsistent responses can cause delays or lead to further rounds of inquiry. FINRA may also request updates if your business plan or team structure changes during the review period.
You can expect this phase to involve multiple back-and-forth exchanges. Therefore, staying organized and assigning internal responsibility for tracking and responding to these requests promptly can help keep the review on track.
Step 10: Complete the Membership Interview
Once FINRA has reviewed your application materials and responses, it schedules a membership interview with your firm’s principals. This meeting is a standard part of the approval process and typically includes key personnel such as your CEO, Chief Compliance Officer, and Financial and Operations Principal.
The purpose of the interview is to confirm your firm’s readiness to operate as a broker-dealer. FINRA staff may ask questions about your business model, compliance program, or technology setup. It also helps FINRA assess how well your leadership understands the regulatory responsibilities that come with membership.
How Long Does It Take to Register with FINRA?
The timeline of FINRA registration varies based on your firm's structure, business model, and the completeness of your application. Most straightforward applications take between three and six months from the initial filing to final approval. More complex or novel models, especially those involving digital assets or proprietary platforms, may take longer.
Delays are often linked to missing documentation, licensing gaps, or inconsistent information across forms and supporting materials. Each follow-up request from FINRA adds time, especially if responses are slow or incomplete. Unavailable or unlicensed personnel can also delay the interview stage.
What Happens After You’re Approved
After your firm receives approval, the focus shifts from getting registered to staying compliant. Here’s what to expect once membership begins.
Membership Agreement and Scope Limits
When FINRA approves your application, it will issue a written membership agreement. This document outlines the scope of your approved activities and may include specific restrictions based on your business model, risk profile, or staffing.
For example, a firm might be approved to act as an introducing broker only, with no authority to hold customer funds or engage in proprietary trading. These restrictions are enforceable, and any material change in your business plan may require prior approval through a CMA.
Annual Filings and Renewals
Once your firm is active, ongoing regulatory filings become part of your regular operations. These include annual renewals, financial reports, and other submissions required by both FINRA and the SEC.
Each year, your firm should pay membership renewal fees, file the monthly/quarterly FOCUS report and ancillary schedules, and submit annual audited financial statements. You also need to complete annual certifications under FINRA Rules 3120 and 3130, which relate to supervisory controls and executive compliance oversight.
FINRA typically notifies firms in advance of upcoming deadlines, but tracking these obligations internally is critical. Missing a filing or fee deadline can trigger automatic financial penalties or affect your firm's standing.
FINRA Exams and Ongoing Oversight
After approval, your firm will be subject to FINRA’s ongoing supervision and examination program. This starts with the New Member Examination, which typically takes place within the first year of operations. The exam focuses on whether your firm is following the policies and procedures submitted during the application process.
Beyond that, FINRA conducts periodic routine exams to assess compliance with rules related to supervision, recordkeeping, communications, anti-money laundering, and other areas. The frequency and scope of these exams depend on your business model and risk profile.
FINRA also expects firms to keep their supervisory procedures up to date and adjust them as their operations evolve. Any material changes to your business may require notification or formal approval from FINRA through its Continuing Membership Application (CMA) process.
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Common Mistakes When Registering with FINRA and How to Avoid Them
Some of the biggest delays in the FINRA registration process come from missteps that firms could have avoided with better planning. Here’s what they are and how to avoid them.
Submitting the application without licensed principals: Some firms submit applications before their designated principals have passed the necessary qualification exams, assuming they can complete this later. FINRA treats this as a readiness issue and may hold the application until licensing is complete, which can add weeks or months to the timeline.
Assuming a single principal is enough without requesting a waiver: While FINRA allows a waiver of the two-principal requirement in limited scenarios, firms should request it upfront with a clear justification. Submitting an application with only one principal and no waiver request signals a lack of understanding of basic membership requirements. Late-stage waiver requests are often denied or sent back for further clarification.
Incomplete or inconsistent documentation: The business plan, supervisory procedures, and financial projections should all align. For example, you will raise concerns if your plan says you will operate as a self-clearing firm, but you don’t mention clearing infrastructure or associated costs in your financials. Discrepancies between what you file and what FINRA sees in supporting materials can result in repeated follow-up requests and a longer review process.
Missing or vague supervisory procedures: A generic WSP template copied from another firm won’t meet FINRA’s expectations. Your supervisory procedures should be specific to your firm’s structure, products, personnel, and systems. FINRA wants to see clear lines of responsibility, review processes, escalation paths, and ongoing monitoring procedures that reflect how your firm will operate day to day.
Weak vendor and tech documentation: If your business relies on a third-party vendor for clearing, custody, order routing, or tech infrastructure, FINRA will expect to see those agreements. Even if contracts are not finalized, you should provide draft agreements, term sheets, or letters of intent. If you’ve built your own trading platform or compliance software, be prepared to explain how it works and how it meets regulatory standards.
Poor communication during review: Once FINRA begins reviewing your application, it may request additional information or clarification. Failing to respond quickly or providing vague answers can lead to additional scrutiny. FINRA may view slow or incomplete responses as a sign that the firm is not fully prepared to operate in a regulated environment.
FINRA Registration vs. SEC Registration: What’s the Difference?
Registering as a broker-dealer in the US involves both the SEC and FINRA, but the roles of each regulator are distinct.
The SEC is the federal authority that grants broker-dealer status under the Securities Exchange Act of 1934. As part of this process, firms must file Form BD, which becomes a public record and establishes their legal status as a broker-dealer.
Filing with the SEC, however, is only part of the process. FINRA is the self-regulatory organization that governs the conduct of its member firms. It has its own membership requirements, including supervisory procedures, licensing qualifications, and minimum capital levels. Most firms, especially those that operate outside of a national exchange, should apply for FINRA membership alongside their SEC registration.
In practice, both registrations move forward at the same time. You file Form BD with the SEC through FINRA’s Web CRD system, and FINRA evaluates your membership application in parallel. The SEC generally does not approve the registration until FINRA has completed its review and granted membership.
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Registering with FINRA is a detailed, multi-step process that requires careful preparation across legal, operational, and compliance functions. The process goes beyond submitting forms; it requires showing regulators that your firm has the necessary structures to operate responsibly.
For founders and compliance teams in the fintech space, the challenge often lies in balancing innovation with regulatory expectations. Having the right licensing, documentation, capital, and supervisory structure in place before applying can prevent unnecessary delays.
How Can InnReg Help?
InnReg is a global regulatory compliance and operations consulting team serving financial services companies since 2013.
We are especially effective at launching and scaling fintechs with innovative compliance strategies and delivering cost-effective managed services, assisted by proprietary regtech solutions.
If you need help with broker-dealer compliance, reach out to our regulatory experts today:
Published on Sep 10, 2025
Last updated on Sep 10, 2025
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