Selecting your first, or new forex broker is always a big moment. Depending on your trading style, there may be a number of brokers who are the best fit for you as a Nigerian trader.
Here we have gathered 10 of the best forex brokers in Nigeria to choose from. This should mean there is something to suit everyone.
Table of contents
Is Forex Trading Legal in Nigeria?
Forex trading in Nigeria is legal, however in actual fact there are no regulations in place.
This puts it in a sort of ambiguous place of not being specifically legal or illegal. The word that we can use to describe forex trading in Nigeria best would be to say it is accepted.
While there is regulation on Nigerian traders that comes from the CBN (Central Bank of Nigeria), this regulation does not extend to online forex trading.
How to trade forex in Nigeria
Since forex trading and online forex brokers in Nigeria do not come under any form of regulation, Nigerian traders are free to open accounts with their international fx trading platforms of choice and follow the regulations that this broker has put in place from their own regulatory body.
In that case, you will typically need to provide some confirmation of your ID and proof of residence in line with your brokers regulatory requirement before funding your account.
With that said, since the CBN regulates other exchange trading activities, there is an annual limit of 50,000 NGN that you can send to overseas investments. This means that if your broker of choice keeps your funds overseas, you will have to follow this regulation with the amount your transfer outside the country.
Top 10 Best Forex Brokers in Nigeria
Having considered all factors, here is our listing of the best forex brokers Nigeria has to offer.
Nigerian trader? Here’s what to look for in a forex broker
As a Nigerian trader getting into forex trading, as with every other trader, there are a few things to be mindful of when searching for a new forex broker. These tips can help ensure the best experience for you:
1. Look for top-tier regulatory bodies:
As mentioned, the Nigerian forex market is not directly regulated. This means you should exercise some caution when choosing your broker. To avoid a fraudulent situation, you should always choose a well-regulated broker with oversight from some of the top bodies like CySEC, ASIC, FCA, and other as listed above.
If you want to stay within African regulation, the FSCA of South Africa is also a much-respected regulatory body of choice.
2. Look for Naira Accounts or NGN deposit methods:
For your convenience, you should try to choose brokers who allow for NGN accounts and deposit methods. When you open an account and deposit in another base currency, you will typically be faced with conversion fees.
These fees can be avoided if your broker accepts NGN deposits and base currencies, though these are tough to find although we have featured some.
3. Need to be Sharia compliant? Look for Islamic Accounts:
If you are an Islamic trader then you will need a fully compliant Islamic trading account. This account will help you avoid interest in the form of overnight fees which is considered Haram under Sharia law.
These accounts are generally available free on request from all the broker we featured and where some may charge and admin fee, most provide for the exact same trading conditions. You can read our guide if want to know more about swap free forex brokers.
How to verify if a forex broker is regulated in Nigeria
Since the CBN only regulates exchange trading and not the online forex market in Nigeria, your broker will not be regulated by them. This does not mean it is a scam. In fact, you can easily check your broker regulations around the world depending on the regulatory body, through some of the following links.
With regard to ESMA, you will first need to know which exact regulatory body covers yoour broker, though if that body is a European regulator like CySEC, then your broker will automatically be ESMA compliant.
Is forex trading taxable in Nigeria?
The simple answer here is that yes, it is.
Your forex trading profits will be treated as capital gains and, in Nigeria, this tax rate is 10%. Unlike some other countries, if you do lose money in forex trading, there will be no tax deduction and you will have to file annual income tax as Nigerian residents do.
- [Disclaimer: we are not accountants, we have done internet research. We strongly suggest you contacting Nigerian local authorities if you’re not sure how to manage this aspect]