The financial market of Tanzania is regulated by one major institution – the central bank of the country, also known as BOT (Bank of Tanzania). As for now, the Forex trading market is untouched, meaning that it is not regulated and you will not be able to find local licensed brokerage companies there. Despite being unregulated, the Forex industry is still growing in the country as more people are getting involved in the trading market. Investors that wish to participate in trading do so via international brokers that are fully licensed & regulated and accept traders from Tanzania.
There are some rules when it comes to foreign exchange trade and they are set by the Bank of Tanzania. For instance, interbank trading is restricted to 250,000 USD per transacted unit. Other than that, you will not be able to find out much about Forex trading in Tanzania – as we already mentioned, this industry is completely unregulated at the moment.
Traders from Tanzania can use several payment methods that are introduced on different international platforms including Visa, Mastercard, PayPal, and Wire transfers.
Forex traders in Tanzania, whether they are trading with the international broker or not, are subject to income tax. Tax can be up to 15% depending on how much income you had during a year.
Considering the fact that the Forex market is not regulated in the country and trading is not very safe, it might not be an easy task for some people to find a platform that they can trust, especially if they are newcomers to the industry. That’s why we decided to do a research for you. While there is basically nobody to trade with locally, we advise you to go for other options. For instance, FSCA regulated brokers from South Africa might be a good choice for you. Below, you can see the list of trustworthy Forex brokers that deserve your time, money, and attention.
5$
CySEC, FCA, ASIC
30$, 50%+20%
1:1000
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
250 EUR
FSA (Seychelles)
None
1:200
2023
FXRoad web & mobile platforms
$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.
As we already mentioned, Forex brokers are not regulated and that is the main reason why you will not be able to find any licensed Forex brokers in Tanzania. The majority of people consider trading unsafe because of this, but that is very far from reality. As long as you know how and where to trade, you can make your trading experience safe and enjoyable.
One thing that we know about financial regulations on foreign exchange trades is that the BOT (Bank of Tanzania) restricts minimum tradable currency limits to $50,000 and interbank trading is also restricted to $250,000 per unit. New rules were set at the end of 2020 which also bans banks from accepting currency from people who do not have accounts with them.
The fact that you will not be able to find specific laws that mention anything about the Forex market, leaves some people questioning whether trading is legal or not. Trading is not illegal, as a lot of people in Tanzania have already found an alternate way to trade through international brokerage companies. They allow customers from the country to open trading accounts and make deposits & withdrawals as the rest of the world does that.
Going for the platforms that are licensed is always a better idea than choosing the one with no regulatory body available. Forex trading is regulated in most places of the world including Africa, Europe, and Australia. For instance, South Africa has one of the oldest and most reputable market regulators on the continent. FSCA (Financial Sector Conduct Authority) is a financial regulatory body that supervises all financial institutions providing financial services – that way, FSCA ensures the safety of all the customers involved in trading. That’s why Tanzanian traders can go for South African brokerage companies that offer a safe and transparent trading process.
Trade with a regulated Forex broker – XM
Individual Forex brokers are subject to income tax – you might need to pay different taxes depending on which type of trader you are. Individuals can either be small or medium traders. Small traders are taxed by a presumptive system, while medium determines taxes from audited accounts. For instance, if your total annual income exceeds Tshs 12,000,000 ($5,170), you will have to pay 13.05% plus 30% of the amount in excess of Tshs 12,000,000.
As Tanzanians use international Forex brokerage companies, traders often think that they do not need to pay income tax as profits were made in international website’s accounts but sadly, that is not true. If you are Tanzanian and generate profits from trading while staying within the borders of Tanzania, your money is considered as taxable income and you need to declare it in tax returns.
At the moment of writing this review, we were unable to find any Forex brokers offering TZS pairs. That’s why we instead suggest for local traders to find accounts in ZAR, as most popular Forex brokers such as XM Group, IQ Option, AvaTrade, and HotForex offer different types of accounts/currency pairs with the availability of ZAR.
With the Forex market being unregulated in Tanzania, it will be no surprise to say that there is no cap at leverage for Tanzania Forex brokers at this moment. Generally, financial regulatory bodies restrict brokerage companies from having very high leverage ratios, in order to protect customers from losing their funds. If you are from Tanzania and use an international website for trading, you can easily check maximum leverage on a specific platform’s webpage.
Despite not having a cap on leverage, you should expect it to be somewhere near 1:200 – 1:300 as it is considered the industry’s standard. If you come across something above that, this might be a red flag especially if the broker does not hold a decent license. We advise you to check leverages before starting trading and avoid platforms that offer ratios that do not correlate with what’s considered normal on the market.
The most common payment systems available in Tanzania include Visa, Mastercard, and PayPal. As traders from Tanzania mostly choose platforms that are based in another country, they can easily use payment methods offered by them. For instance, the best Forex broker in Tanzania – XM Group has Debit/Credit cards, along with Skrill, Neteller, Bank Wire Transfers available. However, it is important to note that each of these comes with its own specifications and requirements – some of them may have commission fees and speed transactions are different as well. Usually, the fastest one is PayPal that needs 1 working day, while Visa and Mastercard may take up to 5 days.
Some Forex trading websites might also have limits on deposits and withdrawals, so it is always a good idea to check the details before going for a specific payment method.
Trading Forex in Tanzania may be connected to some risks due to the fact that the country does not have any financial regulatory body that will control the trading market. That leaves the possibility for fraudulent companies to trick newcomers into their systems and if something inconvenient happens (e.g. they steal your money, the company goes bankrupt), you will not be able to do anything in terms of legal actions.
The first thing traders from Tanzania should look out for is fully licensed & regulated international brokerage companies – trusting them with your money does not involve risks as market regulators will be present to protect you from negative consequences in case you get scammed. We advise you to always do research before trading with any Forex platform. For instance, you can read reviews from experienced traders to save time and money. Reading guides for beginner traders might also be a good idea.
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