AuthorBy Chris Cammack
Updated: February 25, 2021

While there is no such thing as an Islamic Forex Broker, there are many brokers who offer Islamic Forex accounts. An Islamic Forex account is a halal Forex account which complies with the Shari’ah prohibition on Riba, or the accumulation of interest.

Islamic Forex accounts will not charge interest on open positions held overnight; this charge is also called the swap fee, so Islamic Forex accounts are sometimes called swap-free accounts. As they will not charge interest, some Islamic Forex accounts will charge commission or have wider spreads than a traditional Forex account.

Islamic Forex trading has never been easier, as many brokers now offer Islamic accounts; these are the best brokers offering Islamic Forex accounts based on their regulation, trading conditions, education and trading platforms.

Forex brokers with the best Islamic accounts

Last updated on 25 Feb 2021
Updated 25 Feb 2021
by Editorial Director Chris Cammackby Chris Cammack
Chris Cammack
All Brokers Regulated
All Brokers Regulated
by Trusted Authoritiesby Trusted Authorities
Trusted
1
AvaTrade
Min. Deposit
USD 100
4.484.48
Min. Spread
0.90 pips
Swap Free
REGULATED BY
Overall Rating
11110.54.48/ 5
AlertAccepts Kenyan Clients. Average spread EUR/USD 0.90 pips on trading account with lowest minimum deposit. Max leverage 30:1. Islamic account available. MT4 & MT5 platforms supported. AvaTrade Group regulated by ASIC, FSCA, B.V.I FSC & FSA.
2
Exness
Min. Deposit
USD 1
4.124.12
Min. Spread
0.10 pips
Swap Free
REGULATED BY
Overall Rating
11110.54.12/ 5
AlertAccepts Kenyan Clients. Average spread EUR/USD 0.70 pips on trading account with lowest minimum deposit. Max leverage 2000:1. Islamic account available. MT4 & MT5 platforms supported. Exness is regulated by CySEC, FCA, and the FSC.
3
XM
Min. Deposit
USD 5
4.254.25
Min. Spread
0.60 pips
Swap Free
REGULATED BY
Overall Rating
11110.54.25/ 5
AlertAccepts Kenyan Clients. Average spread EUR/USD 1.60 pips on trading account with lowest minimum deposit. Max leverage 30:1. Islamic account available. MT4 & MT5 platforms supported. XM Group regulated by CySEC, ASIC, and the IFSC.
4
HotForex
Min. Deposit
USD 5
4.494.49
Min. Spread
0 pips
Swap Free
REGULATED BY
Overall Rating
11110.54.49/ 5
AlertAccepts Kenyan Clients. Average spread EUR/USD 1 pips on trading account with lowest minimum deposit. Max leverage 30:1. Islamic account available. MT4 & MT5 platforms supported. HF Markets Group regulated by the FSCA, FCA, FSC, CySEC and the DFSA.
5
FxPro
Min. Deposit
USD 100
4.244.24
Min. Spread
0.60 pips
Swap Free
REGULATED BY
Overall Rating
11110.54.24/ 5
AlertAccepts Kenyan Clients. Average spread EUR/USD 1.40 pips on trading account with lowest minimum deposit. Max leverage 30:1. Islamic account available. MT4, MT5, cTrader and FxPro proprietary trading platform supported. FxPro Group is regulated by FCA, CySEC, FSCA, and the DFSA
6
FP Markets
Min. Deposit
USD 100
4.284.28
Min. Spread
0 pips
Swap Free
REGULATED BY
Overall Rating
11110.54.28/ 5
AlertAccepts Kenyan Clients. Average spread EUR/USD 0.1 pips on trading account with lowest minimum deposit. Max leverage 30:1. Islamic account available. MT4, MT5 & IRESS platforms supported. FP Markets is regulated by CySEC and ASIC.
7
XTB
Min. Deposit
USD 5
4.144.14
Min. Spread
0.80 pips
Swap Free
REGULATED BY
Overall Rating
11110.54.14/ 5
AlertAccepts Kenyan Clients. Average spread EUR/USD 0.50 pips on the trading account with lowest minimum deposit. Max leverage 30:1. Islamic account available. MT4 & xStation platforms supported. XTB Group is regulated by CySEC, FCA and the IFSC
8
markets.com
Min. Deposit
USD 100
4.494.49
Min. Spread
0.60 pips
Swap Free
REGULATED BY
Overall Rating
11110.54.49/ 5
AlertAccepts Kenyan Clients. Average spread EUR/USD 0.70 pips on trading account with lowest minimum deposit. Max leverage 30:1. Islamic account available. MT4 & MT5 platforms supported. MarketsX is regulated by CySEC, ASIC, and the FSCA.
9
FxPrimus
Min. Deposit
USD 100
3.493.49
Min. Spread
0.10 pips
Swap Free
REGULATED BY
Overall Rating
1110.503.49/ 5
AlertAccepts Kenyan Clients. Average spread EUR/USD 1.50 pips with 0.0 USD commission round turn on the trading account with lowest minimum deposit. Max leverage 1000:1. Islamic account available. MT4 platform support. FxPrimus is regulated by the CySEC, FSCA, and the VFSC.
10
FXCM
Min. Deposit
USD 50
4.134.13
Min. Spread
0 pips
Swap Free
REGULATED BY
Overall Rating
11110.54.13/ 5
AlertAccepts Kenyan Clients. Average spread EUR/USD 1.3 pips on trading account with lowest minimum deposit. Max leverage 400:1. Islamic account available. MT4 & Ninja Trader platforms supported. Forex Capital Markets is regulated by FCA, ASIC, and the FSCA.
11
FXTM
Min. Deposit
USD 10
4.334.33
Min. Spread
0.10 pips
Swap Free
REGULATED BY
Overall Rating
11110.54.33/ 5
AlertAccepts Kenyan Clients. Average spread EUR/USD 1.50 pips on trading account with lowest minimum deposit. Max leverage Flexible. Islamic account available. MT4 & MT5 platforms supported. Leverage offered can vary depending on country of residence, and your trading knowledge and experience. FXTM is regulated by CySEC, FCA, FSCA, and the FSC.
12
Amana Capital
Min. Deposit
USD 50
3.833.83
Min. Spread
0.10 pips
Swap Free
REGULATED BY
Overall Rating
1110.503.83/ 5
AlertAccepts Kenyan Clients. Average spread EUR/USD 1.40 pips on trading account with lowest minimum deposit. Max leverage 500:1. Islamic account available. MT4 & MT5 platforms supported. Amana Capital Group is regulated by the CySEC, FCA, and the DFSA.

    Islamic Forex Trading

    There are three articles of the Islamic Mua’malat that are relevant to Forex trading:

    • Riba: Prohibition of payment and receipt of interest
    • Gharar: Prohibition on gambling
    • Shared Risk: Both profit and losses

    The key element here is the elimination of Riba – or interest on loans or assets.

    Riba is central to conventional Forex trading, but according to Islamic law, or Shari’ah law, Muslims are banned from earning interest on loans. Some scholars believe that the practice of removing Riba, as brokers do on their Islamic Forex accounts, legitimises Forex trading under Shariʻah.

    Islam also emphasises that when conducting business transactions, elements of uncertainty, excessive speculation and gambling should also be avoided, so it could be argued that hedging trades with Forex is also legitimate under Shari’ah. It is also widely agreed that conventional Forex transactions – if used carefully – are a very effective means of protecting banks from exposure to international risk.

    Shared Risk

    Another concern about the Islamic nature of Forex trading is the element of shared risk. Luckily, with Forex trading, when you trade, you are investing in an asset – the currency purchased. If this asset increases in value, you will make a profit and if the asset loses value, you will make a loss. The result is a sharing of the benefits and losses of the currency exchange with your counterparty. From this point of view, Forex trading and Islam are compatible in terms of shared risk.

    What is an Islamic Forex Account?

    Across the Islamic world, many brokers offer Shari’ah compliant accounts to make sure that your trading is not haram – though this does mean that there are a few differences when compared to traditional Forex accounts.

    Islamic Forex accounts have two underlying attributes:

    Other than the above, Islamic Forex accounts usually have the same trading terms and conditions as a regular Forex account. However, some most Forex brokers change the commercial terms of trading with them and might limit the trader from trading cryptocurrencies. 

    Some Forex brokers will widen their spreads on Islamic accounts to compensate for the missed revenue that would otherwise have been generated by collecting interest. Another practice, but is far rarer, is that some Forex brokers charge an up-front commission on trades instead of widening the spreads.

    Forex Brokers with Islamic Swap-free Accounts

    There are a variety of brokers that offer Islamic accounts tailored for Muslim traders. There are usually no limitations on this account type – this means you can trade Forex, commodities, CFDs contracts and every financial instrument that complies with the Islamic financial regulations.

    An important note:  With most Forex brokers, you will need to open a real trading account which can then be converted into an Islamic account. Few brokers have a registration page specifically for Islamic accounts, and even fewer have Islamic demo accounts, but some brokers with clients from predominantly Muslim countries automatically create accounts as Islamic accounts.

    If you are in doubt, make sure you discuss your concerns with your account manager or broker representative before you make a deposit.

    Forex Rollovers and Swap Rates Explained

    In the Forex market, any position held overnight generates a rollover which will be earned or paid out depending on the currency you are trading and the direction of the market. Rollover interest is a form of interest that can be credited or debited from your Forex trading account, and thus it is prohibited by Islamic financial regulations.  In the financial world, this rollover is also known as the swap rate.  So, Islamic Forex accounts are swap-free accounts where no overnight interest is credited or debited.

    Islamic Financial Regulatory Bodies

    The central financial regulatory bodies in the Islamic world are the following:

    Forex brokers that are registered in Muslim majority countries often have to comply with many local regulations and are required to follow Shari’ah law, whereas Western Forex brokers have much more flexibility when it comes to the interest charged to their clients.  This is why only some of the brokers offer this account type.

    Summary

    An Islamic Forex account, or swap-free account, is an optional account type that is often selected after signing up with a broker.  They are intended for use by traders of the Islamic faith, which prohibits generating income from interest payments.  Most Forex brokers can accommodate followers of the Islamic faith by offering swap-free trading accounts that are compliant with Shari’ah law. To learn more about different brokers further reading on how to compare Forex brokers can be found here.

    Forex Risk Disclaimer

    Trading Forex and CFDs is not suitable for all investors as it carries a high degree of risk to your capital: 75-90% of retail investors lose money trading these products. 

    Forex and CFD transactions involve high risk due to the following factors: Over-leveraging, unpredictable market volatility, slippage arising from a lack of liquidity, inadequate trading knowledge or experience, and a lack of regulatory protection for clients.

    Traders should not deposit any money that is not disposable. Regardless of how much research you have done, or how confident you are in your trade, there is always a substantial risk of loss. (Learn more from the FCA or from ASIC)

    Our Methodology

    Our State of the Market Report and Broker Directory are the result of extensive research on over 100 Forex brokers. The explicit goal of these resources is to help traders find the best Forex brokers – and steer them away from the worst ones – with the benefit of accurate and up-to-date information.

    With over 150 data points on each broker and over 3000 hours of research and review writing, we believe we have succeeded in our goal. 

    In a world where trading conditions and customer support can vary based on where you live, our broker reviews focus on the local trader and give you information about these brokers from your perspective.

    All research has been conducted by our in-house team of researchers and writers, gathering information from various company representatives, websites and by sifting through the fine print. Learn more about how we rank brokers

    References

    Featured Brokers

    Trading Forex and CFDs is not suitable for all investors and comes with a high risk of losing money rapidly due to leverage. 75-90% of retail investors lose money trading these products. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

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