Forex Brokers in the United Kingdom (FCA)

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The tone of this article on the best forex brokers in the United Kingdom could have assumed the same tone as tons of other pieces on the same topic. But this one will be different. It is more of a reality check and a call to action for those who want to start trading with some of the forex brokers in the United Kingdom listed here.

If you desire to start trading but have found yourself putting this off repeatedly, the time to end the procrastination is now. This piece is written at a time when the Bank of England raised interest rates to combat inflation in the United Kingdom, which is currently at a 40-year high. The apex bank has warned that there could be a year-long recession and that the United Kingdom must brace for the worst economic conditions seen in over 60 years.

The BoE now projects inflation to come in at 13.3% by the end of 2022. This is a much higher estimate than the last projection of 10%. Wages are not growing as fast, and indeed many companies offer staggered wage increases of 2-5% to their furious workers. But can you blame the companies? The economic crunch is also hitting them, and there is a limit to any wage increases they can come up with.

Forex and CFD trading is one of the best ways to beat the recession and the inflationary trends. If you know how to do this properly, you will generate returns at will and be able to beat inflation. The forex market is a globally connected marketplace with more than $6 trillion daily turnover. No market has this amount of money flowing through it. Only very few countries can boast of GDP that beats this amount.

Suppose you live in the UK and surrounding territories like Gibraltar, or you are in Europe but love the appeal of trading an account that could pay you in British Pounds at a time when the Euro is floundering. If this is your situation, you may want to try forex and CFD trading with UK forex brokers. But to do this, you must be able to answer these questions:

  • What will trading with a UK forex broker mean for me?
  • What do I expect to encounter in terms of trading conditions?
  • How will my money be kept safe and secure?
  • Is UK forex trading regulated?

This article will help answer some of these questions.

Here is what you can expect to encounter when trading with a forex broker in the United Kingdom.

United Kingdom Regulation: What is in It For You?

Europe and the UK were a single geographical entity before Brexit. A European broker could operate freely in the UK with an FCA license. Many brokers in Cyprus and other parts of the EU had branches in the United Kingdom, but Brexit has changed all that. Now the UK forex brokers you will see are homegrown brokers or brokers from the EU that must now have a physical presence in the UK and pick up licensing there due to the cancellation of the previous license passporting regime that operated pre-Brexit.

The retail forex brokerage business in the United Kingdom is regulated, with authorization, oversight and licensing provided by the Financial Conduct Authority (FCA).

Forex Brokers in the United Kingdom: How Does Regulation Affect the Trader?

Being able to do business and reach a global market from London offers a certain prestige in any business. London is the world's financial capital, and it certainly is the forex trading capital of the world.

Much of the $6 trillion daily turnover comes from FX trading activity within the London trading session. To conduct FX brokerage business from London accorded a higher degree of prestige and status than many other locations in Europe and outside of it.

Before Brexit, EU brokers could apply for an FCA license to operate out of London without necessarily having a physical presence there. Licensing has two angles: registration (applying for enlisting in the regulator's register as a financial services company aiming to conduct brokerage business) and authorization (the right to conduct brokerage business).

Many EU firms had registration status but were not authorized to conduct business from London. This practice was open to a lot of abuse. But with Brexit, all that has changed. The Financial Conduct Authority (FCA) is a revamped entity that was formed to provide more robust enforcement of regulation than the Financial Services Authority (FSA), the agency that preceded it. Under the new regime, EU companies must be FCA licensees to operate from London. Any firm wishing to conduct brokerage business from London must be registered and authorized by the FCA.

Many traders today prefer to trade with an FCA-regulated broker than anywhere else. Regulation by the FCA goes well beyond what you get anywhere else. Getting an FCA license is not a walk in the park. No firm would like to commit to the process and expend time, money and resources, only to mess it up with unfair and unethical practices towards their clients. Consumer protection protocols are so strict that some have complained that it is driving brokers out of business. But if you do get to trade with the forex brokers in the United Kingdom found on this site, you will get the desired benefits of regulation.

How are Forex Brokers in the United Kingdom Regulated?

The FCA compliance requirements are a list of seven (7) mandates that all intending UK forex brokers must have to secure authorization and licensing in the UK. These are as follows:

A) Effective Communication Structure

The FCA requires all prospective forex brokers in the United Kingdom to have clear communication channels within the organization. How management decisions are conveyed to all staff must be clear.

B) Management Behaviour

The FCA mandates that all management staff in forex brokerage firms must guide their staff via appropriate behaviour. Therefore, ethical behaviour and proper corporate governance must be in place.

C) Client Response

The UK forex broker must be seen to have an appropriate response to client feedback. Management must ensure client responses are all gathered and acted on. Staff training on appropriate responses to customer feedback is part of what the FCA requires forex brokers in the United Kingdom to do.

D) Staff Training

The FCA requires all forex brokers in the United Kingdom to train their staff on compliance and anti-money laundering protocols. Such training sessions are essential for retooling and refreshing their employees' knowledge and technical skills.

E) Promotional Activity

The FCA prohibits promotions with incorrect or misleading information or which are used as incentives for client account opening. Also, the regulator frowns on promotional information that clouds critical information that could ultimately mislead customers.

F) Records

The FCA mandates brokers to keep personal records of personnel and all activity bordering on transactions, trading activity of clients and other relevant activity. The broker must also maintain documentation that details recruitment processes, competence, training and supervision. These are what the FCA looks at when conducting its oversight functions.

G) Third Party Agreements

The FCA requires UK forex brokers to maintain records of contracts or agreements made with third-party entities. The forex brokerage is expected to conduct some due diligence on such parties.

To summarize, your capital has significant protection if you are trading with a UK forex broker. The FCA breathes down on the brokers and watches their every move.

The FCA has also introduced changes to its Consumer Duty policy to enable forex brokers in the United Kingdom to improve the quality of their service even more. Some of these changes are:

  • Text for terms and conditions is usually lengthy. The FCA wants this cut short, and the language simplified so as not to bury critical information within the hitherto lengthy text.
  • Brokers must waive excessive charges to clients.
  • The product suite of the company must match the client's needs.
  • Ease the process of switching from one product type to another, e.g. changing from a fixed-spread trading account to a zero-spread account.

UK forex brokers have 12 months to enact the necessary changes under the regulator's guidance.

Customer Protection

Customer protection from the FCA comes in three ways:

  • Enforcement activity that extends from fines to outright prosecution of offending brokers
  • Account Segregation
  • FCA register via which customers can confirm a brokerage's status
  • The Financial Services Compensation Scheme

The FCA has a channel via which aggrieved traders can file a complaint against an errant broker. The FCA has been known to apply very tough sanctions, some of which can end up in a prosecution. That is the extent to which the regulator protects clients from unauthorized broker activity.

Traders' funds are also segregated. UK forex brokers must keep their clients' funds in a separate bank account and use these strictly for payment of withdrawal requests and capital return if requested.

The Financial Services Compensation Scheme is the insurance for traders to protect them if their broker goes out of business. Limits of compensation are as follows:

  • Up to £85,000 per eligible person, per firm if the brokerage folded after 1 April 2019.
  • Up to £50,000 per eligible person, per firm if the company failed between 1 January 2010 - 31 March 2019.
  • 100% of the first £30,000 and 90% of the next £20,000 up to £48,000 per eligible person, per firm for brokerages that failed prior to 1 January 2010.

What Can You Expect in Terms of Trading Conditions with a Forex Broker in the United Kingdom?

The FCA has adopted the ESMA new regulations and domesticated them. So despite Brexit, forex brokers in the United Kingdom are still bound to follow these rules.

A) Trading Software

Most forex brokers in the United Kingdom will offer the MT4 and MT5 trading platforms. Traders can use customized scripts, expert advisors and indicators. These brokers are also forex VPS compliant.

B) Margin Requirements

Margin requirements for FX and CFD products follow ESMA's 2018 recommendations. Major currencies carry maximum leverage of 1:30. A Standard Lot trade on the GBP/USD is worth $100,000 and will require $3,300 as margin collateral. Minor and exotic currencies, major indices, and gold come with maximum leverage of 1:20. You will need $5,000 as a margin for a Standard Lot. Stocks CFDs come with a 1:10 leverage, and crypto CFDs come with a leverage cap of 1:5. There are proposals by the regulator to end crypto retail trading, and forex brokers in the United Kingdom may soon be asked to remove crypto CFDs from their platforms.

C) Commissions & Spreads

Forex brokers in the United Kingdom offer various accounts with different spread conditions. Choose between fixed, tight spreads or variable spreads. Some offer a zero-spread account that comes with commissions.

D) Account Types

Consult each UK forex broker on this site to see what kinds of accounts are available and which ones meet your needs.

E) Tradable Assets

Forex brokers in the United Kingdom offer trading in forex pairs and CFDs on stocks and the major global indices. By late 2022, crypto CFDs may no longer be allowed for retail trading by the FCA if the current proposals to prohibit it sail through.

F) Customer Service

Forex brokers in the United Kingdom are by the FCA mandates required to maintain a very robust customer support system. You will get this advantage by trading with a UK forex broker.

G) Value-Added Services

Some forex brokers in the United Kingdom offer value-added services as follows:

  • Forex VPS services with data centres in London ensure ultra-low latency.
  • Trading plug-ins for the MT4, such as those of Trading Central and Autochartist.
  • Access to the MQL market.


The list of forex brokers in the United Kingdom on this site are brokers specially selected to ensure you get the highest standard in regulated FX trading available.