M-Pesa Forex brokers: what you need to know

When it comes to Forex trading, at the end of the day, it is all about being able to transfer money to the account easily and safely. As without money on your trading account, you cannot start trading at all. Makes sense, right? Therefore, the rise of the Forex market led to more and more payment systems offering their services to brokers everywhere around the globe. And there is no surprise in that. That created a great benefit for all sides of trading – brokers, traders, and the service providers themselves.

We have already discussed several main payment systems that have already taken their niche on the global trading market. But today we will focus on the very specific one – M-Pesa. It is specific because it is mostly accepted in African countries like Uganda, Ghana, and Kenya. Thus, the majority of Forex brokers using M-Pesa can be found there. And as the Forex market there is still not fully developed, neither is the payment system that operated there. However, it slowly but surely is getting more confident and commonly accepted.

XM Group

XM Forex Review

Minimum deposit

5$

Regulation

CySEC, FCA, ASIC

Bonus

30$, 50%+20%

Maximum leverage

30:1

Year founded

2009

Trading platform

MT4, MT5, WebTrader

IQ Option

An in-depth IQ Option Review of fees, opportunities and more

Minimum deposit

$10

Regulation

CySEC

Bonus

N/A

Maximum leverage

1:30

Year founded

2013

Trading platform

WebTrader

Forex.com

Forex.com Review

Minimum deposit

250$

Regulation

FCA, NFA

Bonus

N/A

Maximum leverage

200:1

Year founded

1999

Trading platform

MT4

Z.Com Trade

Z.com Trade Review

Minimum deposit

5$

Regulation

FCA

Bonus

N/A

Maximum leverage

200:1

Year founded

2005

Trading platform

MT4

Plus500

Plus500 Review

Minimum deposit

100$

Regulation

FCA

Bonus

N/A

Maximum leverage

30:1

Year founded

2008

Trading platform

Custom

Trading 212

Trading 212 Review

Minimum deposit

100 GBP/EUR,150 USD

Regulation

FCA, FSC

Bonus

N/A

Maximum leverage

1:300

Year founded

2006

Trading platform

Trading 212

AMarkets

Why you should rely on AMarkets reviews

Minimum deposit

No limit

Regulation

FSA

Bonus

25%

Maximum leverage

1:1000

Year founded

2007

Trading platform

MT4, MT5, WebTrader

Trading.com

Trading.com review

Minimum deposit

N/A

Regulation

FCA

Bonus

N/A

Maximum leverage

N/A

Year founded

2019

Trading platform

WebTrader

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 74-89% of retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

M-Pesa payment system general overview

M-Pesa is an Africa-based payment system that was launched by Vodafone in 2007. Currently, that is the largest mobile transfer network in Kenya and Tanzania. However, as it is continually expanding and growing, it is now available in South Africa, Afghanistan, India, Romania, and Albania. Among the services provided by the company you may find:

  • deposit and withdrawal of funds
  • transfer of funds to other users
  • payment of bills
  • purchase of airtime
  • save of funds in a virtual account called Mshwari
  • transfer of funds between the M-Pesa account and a bank account

CFD brokers with M-Pesa payment methodThe platform itself is similar to Safaricom of Kenya and Vodacom of Tanzania as it was created as a subsidiary of those. However, there are still some minor differences to it.

The system is basically using your mobile device as an e-wallet. Just by tying your SIM card and mobile account to the banking one, you can easily pay for services, products, utilities, as well as charge your Forex trading account with money. With M-Pesa sending money from one account to another is actually as easy as sending text messages.

Notably, the funds that are kept on M-Pesa accounts are not actually controlled by the company itself, it is stored in Safaricom headquarters. Which are, in turn, managed by the Kenyan government that keeps this money in a vault. And it doesn’t just store this money, no. Those funds are going for the development of the economy as they are spread among different commercial banks and sectors. That is exactly what we mean when we say that the establishment of M-Pesa benefits the whole economy. Therefore, if you are using its services, you become part of the process as well.

Moreover, everything about M-Pesa operations is fully transparent. Meaning that the Kenyan government closely manages the actions of Safaricom company in order not to allow it to anyhow affect the distribution of the funds raised by the M-Pesa payment system.

Transaction limitations and fees charged

The main factor that dictates for much the users of the M-Pesa Forex trading account will be charged depends on whether the user is registered or not. For instance, traders within Kenya will be charged with the 66 Kshs fee for transfer to any of unregistered traders in case if the amount of the transfer is between 101-500 Kshs. But if the transfer is going to the registered user, then the fee will be 27 Kshs for the same transfer amount.  Meanwhile, the maximum amount of the transfer can be 35,000 Kshs with a fee of 275 Kshs for unregistered users.

Different locations of M-Pesa Forex brokers

As noticed previously, the Forex trading brokers working with M-Pesa are usually located in African countries. But let’s take a look at where exactly those brokers are based.

Kenya

The major portion of brokerage companies from the list of best FX brokers using M-Pesa is located in Kenya. Notably, the payment system came to Kenya in 2007 when the local company, Safaricom, decided to establish its own money transfer network. Once the government saw the growth of the company’s share, the Kenyan finance minister decided to check up on the company in order to find some fraudulent actions. However, it failed to do so and the company continued to attract even more loyal customers. Thus, the overall amount of estimated cash flow of all transfers managed reached KES. 2.1 trillion in 2014, which, in turn, showed a  28% growth since 2013.

Afghanistan

Yet another country with dozens of licensed FX brokers allowing M-Pesa payments is Afghanistan. The company was brought here in 2008 by the local mobile service provider, Roshan. Interestingly, the company is responsible not only for controlling the Forex brokers’ transactions but also for salary payment to policemen, control over merchant payments, peer-to-peer transfers, loan disbursements, and other types of payments.

Tanzania

The service was launched here in 2007 by Vodacom. The service was showing impressive growth ever since it was launched. Thus, by 2013, M-Pesa already had five million subscribers to its platform, and a certain portion of those are traders who are signed with the Forex trading brokers working with M-Pesa.

India

The company was launched in India a bit later, in 2011, as a direct partner of ICICI bank.

South Africa

The service was launched here in 2010 as there were millions of potential Forex traders and simple users that did not have a bank account where they could store their funds. Therefore, in the next three years, approximately 10 million users were successfully registered. However, the growth stopped at some point because of several arguments with governmental policies. So now there are only 1 million subscribers that are transferring funds from an account to account with M-Pesa. Thus, we may logically come to the decision that there are not many CFD brokers with M-Pesa payment method available there.

Regulations of brokerages from the M-Pesa brokers list

As M-Pesa seeks to reach a high level of transparency and reliability in operations for its users, it was regulated by a couple of regulators. Those are the UK’s Financial Conduct Authority (FCA) and the Payment Card Industry (PCI). The company also follows the KYC (Know Your Customer) principle and, thus, requires all of its users to provide them with data that will be kept confidential but will help them to make sure that you are a real person who does not have any bad intentions for Forex trading.

The first steps

Notably, one of the first ever Forex trading brokers with M-Pesa withdrawal option was EGM Securities. The brokerage was the pioneer of African market that took a risk of using a young payment system and was not disappointed. That actually was a huge step for the whole Forex market in African countries. As it gave those direct access to the rest of the global trading market. It advanced the depth of the financial market and improved economic growth.

Why a number of Forex brokers accepting M-Pesa is growing?

Forex brokerage accepting M-PesaThat phenomenon in countries like Kenya might be explained by the fact that Forex brokerage accepting M-Pesa receives a number of benefits provided by the local payment system rather than paying larger fees for using foreign ones.

Meanwhile, M-Pesa is truly a convenient tool for low-cost, fast and safe payment, transfer, and storage of money. Moreover, as everyone knows how tough and depressing is the economic situation in African countries, especially in countrysides. Thus, there is a common thing that relatives living in urban centers are often sending money to other family members who live in villages. And as it might be simply complicated and time-consuming to send money via post or in any other way, the M-Pesa transfers of money comes in handy. Also if you are using M-Pesa for Forex trading purposes only, it still is a great option. As the transaction and administration fees are not as high as with other global payment systems.

Yet another bright side is that there is no minimum transfer amount. That means that everyone can use the service. All in all, M-Pesa provides not only benefits for the ones who are into Forex trading, but to all citizens. Cause the creation of such a financial platform leads to the development of the whole financial market as a result.

Even Bill Gates once said: “Kenya’s M-Pesa proves that when people are empowered, they will use digital tech to innovate on their own behalf.”

Moreover, we would like to notice how the establishment of M-Pesa leads to a decrease in corruption levels in such countries like South Africa and Afghanistan. As all transactions become transparent and traceable, that is easier for governmental institutions to control money laundering and find the scams easily.