FCA UK Forex Brokers

Introduction to FCA UK (Former FSA)

In every financial market, a guardian or supervisor must be present to ensure the stability & transparency of the whole system. It doesn’t cover only investor, rather it also covers the brokers also. Because, a consumer must know what they are dealing with & based on those things they have an expectation. The broker must also know the expectation of retailers. They should know the reason for investing on financial market.

Therefore, for Europe Financial Services Authority (FSA) was formed. But due to global financial recession of 2008, this authority failed to fulfill its mission. But the journey didn’t end here. And that’s why on April 2013, FSA starts its journey again with its new name FCA which means Financial Conduct Authority. And within a short time this organization became successful to maintain the integrity of the financial market of Europe.

FCA is empowered under the Financial Services and Markets Act 2000 and Financial Services Act 2012. And Right now more than 56,000 financial services agencies are under FCA’s jurisdiction.

What does mean “FCA REGULATED Broker” for a Retail Forex trader?

To make trading safer for the retailers, FCA defines some standards which includes a broker’s business plans, risks, budgets, resources, systems, controls and whether key staff have the necessary qualifications, experience and ability to carry out their roles effectively. So if a broker can satisfy this standards, then FCA will approve that broker and it will be called FCA Regulated Broker.

Now here the burning question comes that, why a FCA Regulated Broker is important for a retail broker.

First of all, since the whole trading system incorporates a large amount of money, so the initial goal of a retail trader should always be keeping his money safe. But there are lots of scammers, who spreads attractive offers, advertisements and other fake benefits those compel investors to invest more money. And the loss is inevitable here, because most of the time the whole system is fake.

That’s why, to save this problems, regulatory bodies entered into the market to announce the transparency of good brokers. However, not every regulatory body has not the same quality.

And in terms of quality, FCA is one of the best and most popular regulatory bodies around the world. The reason is they are very strict in rule & consistent in performance. So, ‘FCA Regulated Broker’ can ensure a retail trader their safety of fund, quality of service and manipulation free market.

FCA Responsibilities

Since FCA has a large number of members & it is also very popular in Europe, it brings a large number & wide variety of responsibilities for them. The main agenda of FCA is to make a hassle free financial market for everyone. And to reach this goal it possesses some responsibilities.

Here are the core responsibilities of FCA:

Making a fair trading ground for both broker & money makers.
Protection of the money of consumers & ensuring the business security of brokers.
Take proper action to assure the integrity of financial market.
Boost up the market & make a safeguard between the broker & consumer or broker + consumer & third party.
Supervision of member agencies, make new regulations depends on with new requirement & regular market analysis.

How FCA Regulation Protects You

UK’s financial market employs more than 2 million people in the country which in turn makes it one of the largest tax contributor of UK economy. The approximate tax collected from the financial market is 65 billion euros. It means if somehow this market falls or even the reputation falls, the total UK economy will fall under a tremendous pressure. That’s why all the regulators have maximum focus on investors protection & they set the directives based on investor’s right.

Here are two particular ways those we should mention as example:

FCA imposes rules not only on brokers, but also it regulates individual products also. As a result, the investment services firms are filtered from their inner sections.
According to the directives, even authorized person of a brokers can’t enter into all your information. It protects your privacy and ensure that your data will not be misused or used without your permission.

Investor’s Protection: The Compensation Scheme

Before applying to FCA, every broker has to subscribe UK’s Compensation Scheme. And FCA is offering the highest compensation in UK’s market. The amount of compensation is up to 50,000 euro. The investor is whether beginner or advanced level, this amount is very handsome for all.

Guidelines for FCA Regulated Brokers

Here is some tips or guideline for all new brokers who want to get regulated by FCA:

Before applying to FCA, a broker needs trade license to operate their business in UK. To get this license, every broker has to go through a tough and long application procedure.
To be a FCA member, you have to maintain at least 1 million euro operating capital in UK. Otherwise you’ll be disqualified.
Every broker has to be a member of UK’s compensation scheme & manage segregated account for the investors.

So these are the main tips to follow. However, some fraud brokers or even some good brokers use FCA banner before getting the membership. In this matter, we’ll say don’t do this suicidal task because FCA has a public list of their members that anyone can check online. So, if someone doesn’t find your name there, you’ll lose his trust and it may also fetch your agency to a permanent banishment.

CySEC vs FCA

CySEC & FCA both are leading regulatory body of European Financial Market. And as they are independent from each other, so both these authorities have their own rules & guidelines for brokers & retailers. Let’s make a quick comparison between them.

CySEC	FCA
Cyprus based regulator.	UK based regulator.
Compensation fund is up to 20,000 Euros	Compensation fund is up to 50,000 Euros

Conclusion

Every regulatory authority enters into market to bring a motto of protecting the interest of retailers. FCA is not out of them too. So, this regulatory body made the rule those are best for everyone related to financial market. And this is an incremental process. So, the rules will always be updated depends on the demand of every member of UK’s financial market.

FAQ: Frequently Asked Questions

How Is FCA Beneficial to A Consumer?

We think there 3 the main beneficial facts you can consider. They are protection of fund, transparency of trade and a handsome compensation.

Does FCA Provide Mediation or A Complaint Resolution Service?

Yes, it does. There is a in individual division for this.

So, I have A Complaint against an FCA Forex Broker, What Should I Do?

At first check is the complaint is related to FCA rules or not. If yes, then directly let them know the issue. They’ll do the rest. But if the complain is somehow not related to FCA rule for example, site is offline for few minutes or something like that then its better to inform the broker.

How Does FCA Regulation Work?

Its actually common like other regulators. There is a set of requirement for getting approval to FCA. And after getting approval this regulation provides operation rules so that the whole process remains crystal clear from start point to end point.

Are FCA Regulated Brokers Reliable?

FCA is one of the most popular regulatory authority in UK as well as in the world. So, they never regulate underqualified and dishonest brokers. Therefore, we can say FCA regulated brokers can always be trusted.

FCA UK Forex Brokers 2024 List

Broker

Country

Min. Deposit

Regulators

Leverage

Action

Windsor Brokers

Cyprus

500 USD

BaFin, CySEC, FCA, MiFID

1:400