Forex trading as a hobby has grown massively over the last few years, with a huge influx of new traders on social media. Brokers offering large leverage, small deposits and a huge amount of forex courses have lead to a massive spike in traders looking to get involved with the financial markets – which is great! However, forex isn’t legal in all countries and you need to do your due diligence before trading in certain counties. With that in mind, is it legal to trade forex in Nigeria?
It is legal to trade forex in Nigeria. If you’re looking to trade investors capital, you would need to be licensed to do this legally but it’s completely legal to trade your own capital. The governing body is currently looking at the regulations in this area – but it’s currently legal to trade.
Forex Trading In Nigeria – The Law
As of 2021 it is completely legal to forex trade in Nigeria. This is providing you are only trading you own capital. If you’re looking to take on investor capital you would need to get a license to do so – which can be costly and time consuming.
Getting licensed is something that needs to be done worldwide, unless you opt to take on additional funds from a prop firm, instead of investors.
It’s an interesting time for forex traders in Nigeria as the rules are only just really being formed now, in terms of the regulators and what is/isn’t allowed. It’s important to understand that you will still be taxed on the money you make from trading forex, within the current regulations.
It’s worth noting that there are still many obstacles for Nigerian forex traders, compared to in other countries.
In the U.K, there are certain tax efficiencies with spread betting, rather than actually trading spot forex, but in Nigeria nothing like this has taken effect yet so be sure to be on top of your taxes.
It’s actually a great time to trade forex in Nigeria. With the rules more relaxed, it allows for higher leverages and frankly traders can make the most of opportunities.
When countries governing bodies crack down on forex trading and reduce the leverages, it can be harder for traders to make the same amount of profits – without having to rely on prop firms to increase capital. I would definitely make the most of the trading conditions at present, before the Central Bank of Nigeria tighten up the regulations.
Finding A Broker As A Forex Trader In Nigeria
If you’re trading forex in Nigeria you will want to be using a regulated broker that accepts Nigerian traders. As there aren’t currently many regulations within Nigeria, a Nigerian based broker can easily manipulate market conditions, not pay traders and cause you a few issues that would result in losses. With this in mind, it’s going to be worth finding a broker that is based outside of Nigeria for you to trade with.
Although there are more and more forex brokers coming up in Nigeria, until the Central Bank comes up with tight regulations I would still advise using an overseas broker.
There is a handy list from Compare Brokers here that breaks down all of the best forex brokers currently accepting forex traders from Nigeria.
Currently, the top brokers accepting Nigerian traders are:
I’d certainly recommend checking out these brokers if you’re trading from within Nigeria. My personal choice would be IC Markets – I have used them consistently over the last 5 years and never had any issues withdrawing, or any trading issues at all.
The Best Prop Firm For Nigerian Forex Traders
For traders looking to increase their capital and get into the 6 figure trading bracket, prop firms are the fastest and best way to go. Luckily, a lot of the top prop firms are offering funding to forex traders based in Nigeria – giving them the same opportunities to trade large capital, despite the lack of regulation in Nigeria.
There is actually a prop firm based in Nigeria – which may be the best option for Nigerian forex traders. BluFx has an office in Nigeria and offers traders in Africa instant funded accounts with a monthly fee, no performance challenge and no hidden costs! I have a full, in-depth review of BluFx here breaking down my experience with the company, so it may be worth having a read.
Although BluFx is the only forex prop firm with a local presence in Nigeria, there are plenty more firms offering funding to traders based here.
Currently the top forex prop firms accepting Nigerian traders are:
|Prop Firm||Funding For Traders|
|LuxTradingFirm||Up To £10,000,000|
|FTMO||$400,000 After Challenge|
I would certainly recommend trying some of these prop firms to scale up your trading career, or check out our best prop firms list to compare offerings.
In Summary – Can You Trade Forex In Nigeria?
In conclusion, you can legally trade forex in Nigeria as of 2021. The regulations from the Central Bank are still very loose and we expect the rules will be further strengthened over the coming years. You must declare profits made from forex trading, to be taxed as income. If you want to trade money for investors, you must get licensed which is a long and time consuming process – a forex prop firm would be a better bet.
If you have any questions about trading forex in Nigeria please do let me know in the comments down below and I will strive to answer you!