How should you compare forex brokers in South Africa, and find the best one for you? In our South Africa forex brokers list, we have taken into account a range of ranking factors, from FSCA oversight to fees and spreads, trading platforms, plus charting and analysis options.
Ultimately though, the top forex broker in South Africa will often be a matter of individual preference. It may come down to access to FX pairs with the ZAR, the platform and app, currency trading using spot markets or per point, or simply ease of use requirements. Follow our comparison guide to find the right South African forex broker for your needs.
How South African Forex Brokers Work
Forex brokers in South Africa facilitate the exchange of one currency for another. For example, you have ZAR but want to speculate on the comparative value of the USD. As a result, you can turn to an online forex broker to trade the USD/ZAR. In doing so, you are essentially buying one currency and selling the other.
Forex is the most liquid market in the world with a daily trading volume of around 100 trillion Rand. However, the ZAR’s status as an emerging market currency means it comes with less liquidity than developed market currencies, such as the USD, EUR, GBP, or AUD.
As a result, forex pairs with a ZAR component are known as ‘exotics’, and usually come with wider spreads, meaning higher costs. The flip side is that lower liquidity often leads to higher volatility, and in turn, greater potential profits.
As we explain in more detail below, the best forex brokers in South Africa will offer access to a wide range of forex instruments, from currency pairs that contain the ZAR to other popular assets, such as the USD/EUR, USD/GBP, EUR/GBP, USD/JPY, and EUR/JPY.
FSCA Oversight
South Africa’s Financial Sector Conduct Authority (FSCA) was established in 2018 as the successor to the Financial Services Board (FSB). The FSCA supports the efficient and stable running of the country’s financial markets while ensuring customers, including retail forex traders, are treated fairly.
Whilst is it not mandatory that forex brokers in South Africa are regulated by the FSCA, a license from the country’s financial watchdog does offer advantages to retail traders. As well as demonstrating a firm’s legitimacy, FSCA-regulated forex brokers must segregate client capital from their operational accounts, protecting customers in the event of broker insolvency.
Licensed firms also have to maintain an office in the country, meaning South African forex traders can access localized support. In addition, FSCA-regulated brokers are more likely to offer forex accounts with ZAR as the base currency, plus local payment methods, reducing deposit and withdrawal fees and facilitating near-instant account funding.
It is worth pointing out, however, that many leading overseas forex brokers accept South African traders.
And whilst they may not always hold a license with the FSCA, they are often overseen by tier-one regulators, including the UK’s Financial Conduct Authority (FCA), the Cyprus Securities & Exchange Commission (CySEC), and the Australian Securities & Investments Commission (ASIC).
These agencies often go above and beyond the FSCA’s requirements, with restrictions on misleading bonuses and caps on the maximum forex leverage available to retail traders.These watchdogs also insist that licensed forex brokers offer negative balance protection, ensuring client accounts do not fall below zero, which is not a requirement under the FSCA.
How To Find The Best South African Forex Broker
Key components to compare when choosing between forex brokers in South Africa include:
Fees
The services that South African forex brokers provide are not free.Costs will be applied through spreads, commissions and rollover fees.Low trading fees are a huge draw, though we wouldn’t recommend choosing these at the detriment of access to stable trading conditions.
Fee structures will differ between South African forex brokers, and even from one account type to another.There are two widely used basic setups:
- The broker charges a spread only.All other fees – with the exception of the rollover rate – are included in the spread.
- Besides a tight/low spread, a commission is charged.
- This commission is based on the amount you trade.
Of these two fee arrangements, the second is arguably the more transparent. That said, the commission/spread combination may not be the cheapest choice in every instance.
Importantly, spreads can be fixed or variable. Fixed spreads are always constant. ECN brokers may even deliver zero spreads. Variable spreads change, depending on the forex asset, volatility and available liquidity.
Let’s say the ZAR/USD currency pair has a sell price of 17.2324 and a buy price of 17.2409. This means the spread is 0.0085 (17.2409 – 17.2324). On top of that, your forex broker may charge a fixed round-turn commission of 80 Rand.
Daily spreads may only differ slightly among South African forex brokers, but active traders (or even hyperactive traders) are trading so frequently that small differences can mount up and need to be calculated to compare costs.
It is also worth checking for any deposit and withdrawal fees, plus inactivity penalties. In addition, forex positions kept open overnight incur a rollover fee. This fee results from the extension of the open position at the end of the day, without settling. The rollover rate results from the difference between the interest rates of the two currencies. The first of the pair is the base currency, while the second is the quote currency.
Market Coverage
The top forex brokers in South Africa will offer a range of major, minor and exotic currencies.
This means you can trade the ZAR, an emerging market currency, with more liquid, established currencies like the USD, EUR, GBP, AUD, JPY, or CHF.
It is also worth reviewing the other instruments offered. Does the forex brokerage offer access to the Johannesburg Stock Exchange (JSE), for example? A diverse portfolio will help you manage risk and generate returns in the long term.
Deposits & Withdrawals
The payment methods offered by South African forex brokers are an important consideration. The top forex brokers that accept South African traders will offer local deposit options and e-wallets, helping to reduce transfer fees while enabling instant account funding.
It could also be worth looking for forex brokers with ZAR accounts. These can save sometimes costly conversion fees if you have to transfer ZAR into a USD-denominated account, for example.
Finally, what is the minimum deposit requirement? Beginners may want an online forex broker with a low requirement of around 200 Rand. High-volume traders, on the other hand, may prefer to pay more upfront in return for lower fees, market insights, and premium analysis tools.
Minimum deposits typically range from 0 Rand to 10,000 Rand.
Account Types
From cash, margin or PAMM accounts, to Bronze, Silver, Gold and VIP levels, South African forex account types can vary. The differences can be reflected in costs, reduced spreads, access to Level II data, settlement or different leverage.
Micro accounts might provide lower trade size limits for example.
The key is finding a forex account that compliments your strategy and is compatible with your budget. It is also worth noting that the best forex brokers in South Africa offer free demo accounts so you can try before you buy.
Account Opening & Registration
Is it a simple process to open a forex account? Do clients need to be verified? FSCA-regulated brokers, plus firms that hold licenses with other financial agencies, typically have to perform know your customer (KYC) checks in line with anti-money laundering (AML) requirements.
As a result, South African forex traders may need to submit a copy of their Smart ID Card, plus copies of bank statements and utility bills to verify their name, date of birth, and address, among others. Forex brokers that accept South African traders often will not permit real-money investing or approve withdrawals until KYC checks are complete.
Note, the top FX brokers in South Africa will perform these checks within a few working days. An increasing number of firms are also using AI-powered technology to automatically process and review documentation, speeding up the account activation process.
Regulation
As we outlined above, forex brokers that accept South African traders don’t need to be registered with the Financial Sector Conduct Authority (FSCA). With that said, it is best to look for oversight from a top-tier overseas regulator if you don’t sign up with FSCA-regulated forex brokers.
Organizations such as the UK’s Financial Conduct Authority (FCA), the Cyprus Securities & Exchange Commission (CySEC), and the Australian Securities & Investments Commission (ASIC) are highly rated.
These watchdogs provide access to compensation schemes, negative balance protection and segregated client accounts, among other safeguards.
Note, some of the top forex brokers that accept South African traders hold a legal license with the FSCA and other trusted regulators. AvaTrade for example operates under the name Ava Capital Markets Pty Ltd, regulated by the FSCA. The firm also operates several other entities which hold licenses in the respective jurisdictions they are active, including the ASIC.
Note, offshore regulation – such as licensing provided by Vanuatu, Belize and other island nations – is not trust-inspiring. Beyond a nominally available dispute-resolution system, such regulatory coverage offers zero protections.
Leverage
The FSCA does not limit the amount of leverage available to retail forex traders. Therefore, you may be able to access leverage up to 1:1000 or more. The benefit of high leverage is increased purchasing power and potential profits. However, leveraged trading can also magnify losses.
Note, forex brokers that accept South African traders but that are regulated by European agencies, for example, may impose lower leverage caps of around 1:30.
Bonuses
Again, the FSCA does not impose restrictions on the financial incentives and promotions that forex brokers in South Africa can offer to prospective traders. This means new users can often benefit from no-deposit bonuses or welcome rewards. HF Markets, for instance, offers a range of bonuses, including a 20% bonus program if an initial deposit of ZAR 800 is made.
Note, always review withdrawal terms and conditions before opting into a forex bonus.
Trading Platforms
Many of the best forex brokers in South Africa offer the MetaTrader 4 (MT4) platform.
MT4 offers in-built technical indicators, one-click trading, customizable charts, expert advisors, and an economic calendar. MT4 is available through desktop software and internet browsers.
It is also common for forex brokers accepting South African clients to offer MetaTrader 5 (MT5) and TradingView. MT5 is the latest evolution of MT4, with more analysis tools and order types, suiting more experienced traders. TradingView offers powerful charting features and a beginner-friendly interface.
The best forex brokers in South Africa will also offer a mobile application so you can trade on the go. Look out for the full functionality of desktop devices but with mobile-optimized features.
Tools & Features
From charting to futures pricing or bespoke robots, forex brokers in South Africa offer a range of additional tools to enhance the investing experience. Again, the availability of these as a deciding factor on opening account will be down to the individual.
Level 2 (or Level II) data is one such tool, where preference might be given to a brand delivering it. For beginners, copy trading can be an effective way to learn from experienced FX investors.
Customer Support
You need someone to talk to when you run into problems with your deposits, actual investing, or withdrawals. Competent support is a must. From opening an account to helping with the platform, customer support can be important.
The top forex brokers in South Africa will provide responsive customer support options.
Live chat is often the most reliable and typically integrated within trading platforms. The best forex brokers in South Africa will offer 24-hour customer service.
Education
Some forex traders benefit from access to education. From guides to classes and webinars, educational resources vary between brands. The best forex brokers in South Africa will organize resources into experience levels; beginner, intermediate, and advanced.
Topics can include understanding spreads and fees, or interpreting announcements from the Reserve Bank of South Africa, and their respective impacts on the strength of the ZAR.
South African forex brokers with rich educational materials are a particularly good choice for beginners.
Final Word On Forex Brokers In South Africa
The top forex brokers that accept South African traders offer low fees on currency pairs with the ZAR, alongside reliable tools and fast trade executions. The best brokerages also hold a license with the FSCA or another trusted overseas regulator.
Use our guide to compare forex brokers that accept South African traders. Alternatively, head to our list of the best South African forex brokers based on our experts’ in-depth testing and detailed reviews.
FAQ
How Do Forex Brokers In South Africa Make Money?
South African forex brokers typically make money through a combination of spreads and commissions, plus rollover fees.
Spreads can be fixed or variable while a commission is a flat charge per trade. Rollover fees are applied to positions held overnight. Importantly, because the South African Rand is an exotic emerging market currency, FX pairs with a Rand component typically come with wider spreads, meaning higher costs.
Note, the cheapest forex brokers do not always make the top 5 or 10 lists because they fall short in other areas, such as execution speeds and access to tools and markets.