Trading Forex in Pakistan is as legal as it gets. Every single financial and monetary activity in the country is monitored by The State Bank of Pakistan. Naturally, this means that if you’re one of the Forex brokers in Pakistan, you need to be licensed and regulated by The State Bank of Pakistan.
Under SBP, there is a Foreign Exchange Regulations Act of 1947 which defines all rules and laws regarding foreign exchange in the country.
The local currency of the country – PKR is available for trading, however, there are not many Pakistan Forex brokers that offer accounts and currency pairs with the availability of the Pakistani Rupee.
Most of the payment methods offered by Pakistani Forex brokers include popular options such as Skrill, Neteller, PayPal, Visa, and Mastercard.
When it comes to Forex trading, one must be aware that making a profit from trading activities is not free and you can be subject to tax. Under the rules of the Federal Bureau of Revenue, tax filers need to pay up to 15% of their Forex profits. In case you are not a tax filer, you will still have to pay standard capital gains tax.
Additionally, according to SECP, which is the regulatory body in Pakistan, authorized brokers can only provide a maximum of 3000:1 leverage if they intend to offer Forex financial services to the traders living in the country.
A few years ago finding a reliable Forex broker in Pakistan would’ve been impossible without the help of the government or a knowledgeable local, unlike in Europe, where you can easily find the best European Forex brokers. However, the government has given rights to many international brokers to be able to cover the market, this has made the list a lot bigger and safer. In order to save you some time we decided that a list of the most reliable and trustworthy FX brokers in Pakistan needed to be made. From this list, you can easily choose the best place to start your trading journey.
5$
CySEC, FCA, ASIC
30$, 50%+20%
30:1
2009
MT4, MT5, WebTrader
$100
CySEC, CBI, FSA, FFAJ, BVI FSC, FSCA, FSRA
1:400
2006
MT4, MT5, WebTrader, AvaTradeGO
USD 5,000
FINMA, FCA, ASIC, FSA, MAS, AFM
N/A
1:30
1992
SaxoTraderGo, SaxoTraderPro
$5
SVGFSA, FCA, DFSA, FSCA, FSA
From 30% to 100%
1:1000
2010
MT4, MT5
15
CySEC
30%
1:500
2015
MT4, WebTrader
$250
FSCA
1:200
2012
MT4, WebTrader
100$
FCA
N/A
30:1
2008
Custom
$10
Risk Warning: YOUR CAPITAL MIGHT BE AT RISK
N/A
1:1000
2013
Proprietary
10 USD
FCA, CySEC, FSA
N/A
1:Unlimited
2008
MT4, MT5, WebTerminal
$10
N/A
N/A
1:500
2019
MT4, custom
$10
1:500
MT4
250$
FCA, NFA
N/A
200:1
1999
MT4
$25
ASIC, CySEC, FSA, BVI
50%
1:400
2001
WebTrader, MT4, TradingView
100
FCA, CySEC, DIFC, CIMA
N/A
500:1
1977
MT4, MT5
$100 AUD
ASIC
N/A
500:1
2005
WebTrader, MT4, MT5, IRESS
AUD$200
ASIC, SCB, CMA, CySEC, FCA, BaFin and DFSA
N/A
1:400
2010
MT4, MT5, cTrader, TradingView
$50
N/A
N/A
1:500
2015
MT4
1 USD
ASIC, FCA
10 USD
1:500
2005
MT4, MT5, 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.
In general, trading in Pakistan is one of the least restricted activities, especially compared to the neighboring countries. Within the Forex market in the country, everything is in accordance with the law and regulations. Furthermore, there is a special organization overseeing the market activities and regulating the trading environment in Pakistan – the Securities and Exchange Commission of Pakistan (SECP).
Some of the largest Forex brokers in Pakistan happen to also do business in other countries. The reason they are able to do this is that of the quality of the regulator they have for themselves.
The Exchange Policy Department (EPD) is charged with the responsibility of making sure that the foreign exchange market is stable, which means that they need to keep an eye on literally every regulated Forex broker in Pakistan.
Thanks to the EPD’s firmness in regard to Forex regulations, every single trader has the privilege to be able to choose their very own CFD brokers in Pakistan. The country takes into consideration and accepts The Foreign Exchange Act of 1947.
Trade with a regulated broker – HotForex
Forex trading in Pakistan is not free, as in the majority of countries where this industry is regulated. If you are someone who is a tax filer, it means that you will have to give up 15% of your Forex profit, so make sure that you have enough money to pay to the government.
On the other hand, if you are not a tax filer, it does not mean that trading Forex will be free for you. In that case, you will be subject to capital gains tax. The capital gains tax rate can be different (ranging between 5-20%), depending on the amount of your annual income. For instance, if your annual income was more than PKR 15,000,000 (approximately $94,500) you will have to pay 20% to the government.
The local currency of the country – the Pakistani Rupee is available for trading, though, as we already mentioned, not a lot of Forex brokers suggest accounts/currency pairs in PKR.
At the moment of writing this review, we were unable to find a broker offering PKR pairs, so instead, it might be a better idea for local traders to find accounts in USD. There are a lot of reputable Forex brokers available on the internet that offer accounts and currency pairs in USD, including XM Group, AvaTrade, HotForex, and IQ option.
Start trading USD with HotForex
According to the law of the country, Pakistan Forex brokers can have a maximum of 3000:1 leverage for regular clients and 20:1 for retail clients. Generally, the cap on leverage is due to the fact that high ratios can easily help customers lose all their funds, so with the restrictions, financial regulatory bodies protect you from negative financial consequences.
While most Forex brokers in Pakistan will provide leverage somewhere between 200:1 and 300:1, you might come across some companies that might offer something higher. We advise you to avoid them at all costs, especially if they are not regulated – there is a high chance that they are fraudulent and aim to scam you. If you see a broker with high leverage that is strongly encouraging you to start trading and is convincing you that you will earn fortunes through trading Forex, then it is an alarming sign.
Forex is a dynamic market and therefore instant deposits, timely withdrawals, and seamless transactions are crucial. As we already mentioned, most of the payment solutions offered by the best Forex broker in Pakistan will include the majority of the most popular options like Neteller, Skrill, Visa, Mastercard, and sometimes Paypal, as well. Each of these comes with its own specifications and requirements, so it might be a good idea for you to check the details before going for a specific payment option.
Payment systems are indistinguishable aspects of trading in general. Many issues arise when the clients are trying to withdraw their funds from their trading accounts to their cards, bank accounts, or e-wallets. Sometimes they are not able to withdraw the funds, the commission for withdrawal is too high, or it takes too long to receive the money.
However, the absolute favorite choice still remains to be PayPal due to the simplicity of the platform, low-cost service, and excellent customer support. On the other hand, PayPal does not accept all the brokerage companies and it chooses to cooperate with only the best representatives of the market. The reason behind PayPal’s picky attitude is that the company is trying to maintain its reputation. Therefore, you will not find any unregulated or illegal brokerage companies offering Paypal payment methods.
No matter how many times the supreme court of Pakistan dishes out warnings about how severe the punishment will be for scamming Forex trading, the scammers will still find a way not to be afraid and start scheming for their next hit. So, the first thing that you should look out for when trading Forex in Pakistan, is fully licensed & regulated brokerage companies, as you are going to trust them with your financial assets. In that case, if something inconvenient happens, there will be a market regulator that will protect you as a customer.
You should always read the Pakistan Forex brokers’ reviews and choose the most legitimate, reliable, and transparent broker. Then you should see which of the broker’s trading account types suits your trading goals and needs the best. Afterward, you should preferably open a Demo account and test your trading strategies on the broker’s platform. Finally, you are ready to register a real trading account with the broker and start trading currency pairs at any moment.
We need to mention the fact that for the majority of Forex traders from Pakistan, it might be a good idea to go for Islamic accounts. The majority of platforms we have come across have this type of account available on their website – it is specially designed for customers who are unable to pay/earn interest due to their religious beliefs. Additionally, with Islamic accounts, clients can get access to trading infrastructure and execution speeds enabling them to gain a competitive advantage.
If you plan to start your trading journey, it is crucial that you know all the basics that are related to the Forex market. The good news is that we have already made a couple of guides for beginners at trading, as well as profitable strategies that can help you have better results.
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