Forex Trading in South Africa
Forex trading in South Africa is governed by the FSCA, the country’s financial and securities regulatory body. The FSB, now known as the FSCA, authorizes the sale of derivative instruments to South African traders.
First of all let’s make it clear: What is Forex Trading?
Forex trading entails buying and selling global currencies in the forex market in order to profit from currency fluctuations.
Overall, you buy a currency when you believe its value will rise against another currency and you sell a currency when you believe its value will fall against another currency. The difference between the trade’s entry and exit prices determines your profit or loss when you exit the trade.
What exactly is the Forex Market?
While visiting your bank, you may have noticed ticker symbols for currencies such as USD/ZAR, EUR/ZAR, and so on. These are the currency rates from the live Forex market.
Forex is the world’s most liquid market, open 24 hours/ 5 days a week. Forex is the world’s largest financial market. Commercial banks, governments, central banks, institutional investors, currency speculators and even commercial corporations are all market participants in Forex.
South African Forex Brokers
You will be happy to learn that South African traders have a multitude of Forex broker options.
The best part is that most forex brokers offer a wide range of currency pairs for investors to trade.
Furthermore, South African brokers offer citizens a low minimum deposit facility. There is also usually a low-commission facility and a wide range of instruments that they can trade.
Top Forex Brokers in South Africa
South Africa is one of the most cultured countries in Africa. Thus, it should come as no surprise that the country enjoys one of the most reliable and trusted regulations.
Get to know the top three regulated brokers in South Africa and their reviews.
Here's our list of the best forex brokers for South Africans. These are the ones who value regulation and also want the safest possible access conditions.
In addition, each firm has strict regulations, comprehensive education segments and demo accounts for beginners.
|Minimum Deposit||10 dollar|
|Trading Instruments||Commodities, Cryptocurrencies, Currencies, Indices, Metals, Shares|
|Trading platforms||Metatrader4, Metatrader5, Webtrader|
|Money deposit Methods||Bank wire transfer, Visa, Mastercard, Maestro, Skrill, Neteller, Bitcoin, Unionpay|
2. FP Markets
|Minimum Deposit||100 dollar|
|Trading Instruments||Commodities, Cryptocurrencies, Currencies, Indices, Metals, Bonds|
|Trading platforms||Metatrader4, Metatrader5, Webtrader, IRESS|
|Money deposit Methods||Bank wire transfer, Visa, Mastercard, Paypal, Skrill, Neteller, Fasapay, BPay, Paysec, POLi|
|Minimum Deposit||100 dollar|
|Trading Instruments||Commodities, Cryptocurrencies, Currencies, Indices, Shares, ETFs|
|Broker Type||Market Maker|
|Regulated by||ASICS SCAB.V.I FSC FSA|
|Trading platforms||Metatrader4, Webtrader|
|Money deposit Methods||Bank wire transfer, Visa, Mastercard, Skrill, Neteller, Paypal, Wire Transfer|
These international foreign exchange trading companies in South Africa are valued for their commitment to customer protection, careful monitoring and quick enforcement of restrictions against fraudulent brokers.
South Africa's regulator is the Financial Services Supervisory Authority (FSCA). It is the most trusted regulator on the African continent.
A simple broker must be regulated by at least one of the major regulators or the FSCA. Brokers regulated by more than one regulator are considered more reliable.
All about the Forex Broker License in South Africa
Formerly known as the Financial Services Council, the Financial Services Authority (FSCA) is the regulatory body for South Africa's non-banking financial services industry, which includes, inter alia, collective investment schemes and financial advisers and brokers. It operates under the Financial Advice and Intermediary Services Act 37 of 2002 (FAIS).
While it is perfectly legal for South Africans to trade with forex brokers that are not regulated by the FSCA, South Africans are in high demand, knowing that it is South African laws and courts that control the day-to-day operations of a broker.
As of 1 April 2018, the Financial Services Council has changed its name to FSCA, which is responsible for the regulation and supervision of financial service providers (FSPs) such as forex brokers, investment funds and investment managers.
A company that intends to operate an investment firm to conduct forex business in South Africa must obtain an FSP Category I licence from the FSC.
The application for a Category I licence requires excessive documentation, ongoing liaison with the FSCA and a local presence of the applicant in South Africa to pass the regulatory examinations and pass the local bank check.
Furthermore, the proposed activities of the Applicant and the professional and academic background of all appointees will be scrutinised by the regulator.
Each Applicant must appoint a representative in South Africa, at least one key person and a compliance officer; all persons must be registered with FSCA. At least one key person must be resident in South Africa in order to participate effectively in the management of the company. Each key person and representative must pass certain regulatory examinations which are held on a regular basis in South Africa or the UK.
The licensee must have an account with a local bank to deposit the initial capital and further use it for corporate purposes.
The licensed company is subject to rigorous reporting and ongoing monitoring of its activities by the Compliance Officer who represents it to the FSCA.
The following steps will be completed:
- Collection of relevant KYC documents for initial verification
- Registration of key persons and representatives; participation in regulatory examinations
- Setting up a company/branch in South Africa
- Preparation of business plan and necessary manuals and procedures, obtaining insurance
- Opening a bank account with a local bank, depositing capital
- Licence application with FSCA.