Legal South African Forex Brokers and Trading Platforms 2019
Over the past years, Forex trading has quickly gained popularity in South Africa, despite various rules imposed on traders. But, just like other financial opportunities found online, like South African legal online casinos, for example, South African authorities haven’t tackled this issue with severe measures, but only ones that allow Forex trading as long as certain protective steps in regards to capital outflow are respected.
Thus, the South African government has no regulations regarding the legality or illegality of Forex Trading platforms, but only a system of exchange control that oversees the cash outflow from the country. This system is overseen by the South African Reserve Bank (SARB) and is conducted through the banks and financial institutions.
From 2010 onwards, South Africans are allowed to send money out of the country and to off-shore accounts, which is what most Forex accounts are, but with a specific limit. The current limit per person, as prescribed by the government, is 10 million Rands, which at current USD rates is somewhere about $788,694. This is the only legal restriction South African citizens face.
List of Forex Brokers accepting traders from South Africa:
Payout %: 1:50
Leverage: up to 1:30 *
Plus500 * 80.6% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money
In addition to this allowance, SA traders may also apply for what is called a “single discretionary allowance”, which has a max limit of 1 million Rands and can be used for Forex trading as well. Thus, the total limit is 11 million, when both options are combined. However, before you use both, you should note that any off-shore investment funds (10 million) should be cleared with the revenue service (SARS), i.e. there is plenty of paperwork to be done, like filing Tax Clearance Certificates, and so on.
That’s why most SA traders use the single discretionary allowance (SDA) to fund their Forex account, which only has to be pre-approved by your bank. However, even with the SDA, you still have to take care, as you have to state exactly what you plan to use your money for, unless you want to risk being fined. There’s also capital inflow limits to pay attention to, for when you want to send money back home. For more info about bringing money into the country, you can check with the SARB.
Frequently Asked Questions
What currency pairs is the Rand part of?
Why is the Rand popular among Forex traders?
Is Forex trading taxable in South Africa?
Will I be charged any Trading Fees?
What currency pairs are the best?
How much money am I allowed to transfer back to South Africa?
Thus, to transfer money back, you have to have a foreign currency account and keep your earnings as a foreign currency, which isn’t subject to exchange control rules. However, make sure you don’t use your allowance as travel allowance, as any money not spent in travel allowances may not be deposited back into this account.
Can I Increase my Single discretionary Allowance?
Can I send more than 10 million Rands off-shore?
What Forex Leverage Limits are available in South Africa?
What’s the minimal legal age for Forex trading in South Africa?
- List of Forex Brokers accepting traders from South Africa:
- Frequently Asked Questions
- What currency pairs is the Rand part of?
- Why is the Rand popular among Forex traders?
- Is Forex trading taxable in South Africa?
- Will I be charged any Trading Fees?
- What currency pairs are the best?
- How much money am I allowed to transfer back to South Africa?
- Can I Increase my Single discretionary Allowance?
- Can I send more than 10 million Rands off-shore?
- What Forex Leverage Limits are available in South Africa?
- What’s the minimal legal age for Forex trading in South Africa?
- Who Regulates Forex trading in South Africa?
- South African Off-Shore Forex Legal Forex Trading Platforms
Who Regulates Forex trading in South Africa?
The official regulatory body is South Africa’s Financial Services Board (FSB), which is the financial regulatory agency assigned to overseeing the non-banking financial sector in the country. The agency is independent, much like UK’s FCA or the US NFA, and is a member of the International Organization of Securities Commission. The FSB also regulates South Africa’s biggest stock exchange in Johannesburg.
However, while there are Forex trading brokers that are licensed by the FSB to be found, they are still very rare. Thus, most trading is done via off-shore platforms, simply because they offer better conditions, like tighter spreads, more payment options, and even account bonuses.
South African Off-Shore Forex Legal Forex Trading Platforms
Most South African traders go for trading platforms licensed by other licensing authorities, the most prominent of which are the European regulatory agencies. The most trusted, and thus popular, agencies, are as follows:
CySec – The Cyprus Securities and Exchange Commission is probably the most common licensing agency that’s behind some of the largest legal Forex trading platforms. They also enjoy a great reputation, since Cyprus, as a member of the EU, has to adhere to EU financial regulation policies.
FCA – UK’s Financial Conduct Authority is an independent agency that regulates financial bodies that provide consumer services throughout the UK. The agency is the successor to the FSA and its licenses are a likewise solid proof of trustworthiness.
ASIC – the Australian Securities and Investments Commission is the regulatory body of Australia that oversees Forex and binary option trading. Licenses from the ASIC are not as common, though they are just as reliable.