EU to Ban Payment for Orders in Blow to Digital Stock Brokers

The European Union plans to ban a practice that allows brokers to offer zero-commission transactions to clients by earning a fee from forwarding their orders to larger trading platforms.

The general ban on payment for order flow was included in a wider package of reforms on which EU member states struck a provisional deal with the European Parliament on Thursday. Zero-commission trading is a key selling point for digital brokerages that have sought to challenge traditional banks.