Maker-Taker Pricing
An exchange fee model that pays rebates to liquidity providers (makers) who post limit orders and charges fees to liquidity takers who execute against posted orders.
What is Maker-Taker?
Maker-taker pricing is an exchange fee structure that differentiates between participants who add liquidity and those who remove it. Market makers — participants who post limit orders that sit on the order book and provide liquidity — receive a rebate (typically $0.001–$0.003 per share) when their orders are executed. Market takers — those who submit market orders or aggressive limit orders that immediately match against resting orders — pay an access fee (typically $0.002–$0.003 per share). The system is designed to incentivize liquidity provision, which tightens bid-ask spreads and benefits all market participants. Critics argue that maker-taker creates conflicts of interest for brokers who route orders based on rebate economics rather than best execution for clients, a concern that has shaped regulatory debates around payment for order flow.
Example
A market maker posts a limit buy order at $99.98 on the NYSE. When a retail investor's market sell order executes against it, the market maker receives a $0.002 per share rebate from the exchange (maker rebate), while the retail investor's broker pays a $0.003 per share fee (taker fee). The exchange earns the $0.001 spread between the two.