Advertising Your FX Brokerage in South Africa
It’s no secret South Africa is a rising star in the international forex market – a strong economy, favorable regulations and consistently good performance of the South African Rand (ZAR) internationally have brought its daily trade volume to around $72 billion as of April 2019.
Additionally, the same BIS data shows a significant foreign interest in the South African Rand (ZAR), as more than 80% of exchange volume on ZAR is in the UK, US, and Japan.
Locally, the South African market has opened up for IBs, since one of its largest brokers was forced into administration for regulatory violations in July 2020.
It’s an opportune time for new players in South African forex, but you need to be wise about how you present yourself and network in this market, so let’s get into the details of attracting traders.
Can you advertise in South Africa without an FSCA license?
The South African market is regulated by the Financial Sector Conduct Authority (FSCA), and is one of the richest and most accessible markets in the world of forex trading. As always, when dealing with regulation it is best to consult a local legal advisor. Our notes should not be taken as legal advice. However, to our knowledge, brokers can work with partner IB teams in Africa without needing an FSCA license. You can’t however directly solicit traders with direct advertising or banners, since you need to be regulated there.
So how can an overseas broker attract local South Africans when most locals will prefer a licensed broker to an unlicensed offshore one?
Trust, service and relationships. We have a blog post dedicated specifically to how to build trust with traders while operating in less regulated forex markets.
For brokers looking to go down the route of licensing locally and officially advertising their services, you can find more details on how to obtain a license here: FSCA Forex broker License .
How do you maximize your forex advertising efforts?
It’s a given that your online trading environment and customer service must be top-notch to keep traders happy, but you also need to maximize your efforts by converting more of your leads into traders.
We assume you’re already using a forex CRM, but if you’d like to learn more about how they can help you run your business more effectively, take a look at our solution page. In addition, we also have a post on how to maximise forex advertising ROI so you can enable your marketing teams to create even more successful campaigns.
How to distinguish your brand in the South African Forex market:
- Get licensed with the FSCA and put your FSB number on your website – as stated earlier, many of your clientele might be international but for those looking to take more clients in South Africa, a fully licensed broker will be easier to market as you can directly advertise.
- Carefully review details of the FAIS – The Financial and Intermediary Services Act was amended as of June 2020, view the pdf here. This applies to any advertising you plan to publish in South Africa.
- Include ZAR accounts among your account types, and provide strong offerings– You want to appeal to various traders offering accounts in various currencies, but make sure you have strong terms on your ZAR accounts to interest locals who will make deposits in ZAR.
- Use your website and online experience to make it easy for traders to trade– Brokers who succeed offer online tools that are versatile, reliable and user-friendly. A good client portal for document sharing, detailed back office management and a variety of payment/account options are critical to your success.
- Offer and advertise minimal fees and low minimum deposits – competitive brokers in this market enable low minimum deposits to attract all types of traders as many locals are extremely cost conscious.
- Guarantee certain amounts of returns in your advertisements – A South African company offering forex and bitcoin was recently in the news when FCSA opened an investigation; their advertisements promised clients a specific percentage of returns each month.
- Overlook the importance of local operations in South Africa – Local licensing is a benefit, as it not only communicates reputability to your clients, it also lends you local credibility, since FCSA licensing requires you have at least one company director living in South Africa, and an account with a South African bank. Not having a local customer service number is seen as a drawback in traders’ eyes.
- Skip widely-used trading platforms – Make sure your brokerage can offer popular international platforms so you can immediately make yourself attractive to the largest audiences. CurrentDesk software is compatible with MT4 and MT5, and is fully platform agnostic so you can always change platforms to keep up with market preferences.
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