Oct 06 2020 0
India is not only one of the biggest countries in the world but also one of the most populous forex trading markets. As we know, the forex trading market is very risky. There are a lot of scammers in this market. So how about forex trading in India? Let’s learn how to open forex trading account in India safely.
Forex regulations in India
The only way to make sure you can trade forex safely is trading with regulated brokers. Because of this vital problem, the India Government has given severe restrictions to the Forex markets. Just like any other countries, they made regulations to make sure that the brokers are kept in check.
The next thing is, in the India market, the principles and policies given by the Reserve Bank of India (RBI) are really confusing and hard to understand correctly. RBI is the forex regulation of India. It restricts the number of foreign currencies that you can trade against the Rupee. Let’s learn more about this regulation below.
The RBI regulation
As mentioned above, the RBI has very strict rules when it comes to forex trading and it seems that they don’t want people to join in this risky forex market. Specifically, they control the number of currencies you can trade and how much you can trade them. The maximum amount of money you can trade with RBI-regulated brokers are $200,000. This is quite a setback compared to other foreign forex brokers, where you can trade more than that. Yet we understand that the smaller the amount, the safer it is. However, this also means your potential is limited.
Meanwhile, the Indian government will have all the rights to regulate and monitor the trading of currencies in the country. RBI will be representing the government in such activities. They will decide which broker can operate in the country. Moreover, the RBI only allows traders to trade the 4 following pairs: USD/INR, EUR/INR, GBP/INR, and JPY/INR.
Because of the limitation in the currencies you can choose, the majority of Indian forex traders don't like RBI-regulated brokers. They would prefer a foreign broker who is trusted and allows them to trade various currencies and instruments.
Best foreign currency trading brokers in India
Exness is regulated by the FCA (United Kingdom) and CySEC (Cyprus), so it is very reliable and safe to trade with. Moreover, they have the highest monthly trading volume in the world, which means there are millions of traders doing business. That alone gives Exness a lot of credit.
XM is also regulated by the FCA and CySEC, so it is just as reliable as Exness. Also, XM specifically targets the Asian market so they host a variety of educational seminars as well as training courses for you to join.
HotForex is regulated by FCA, DFSA, SV, FSCA, and FSA. All of them are among the top forex regulations. So trading with HotForex is very safe and secure.
How to open forex trading account in India
It is actually very simple. Almost all brokers have a somewhat similar process. Here is the basic process of opening a forex trading account. Different brokers will just switch the order of the steps. You still have to complete all of the following steps to open an account:
- Go to the homepage and click OPEN ACCOUNT
- Put in your personal information like name, birthdate, email account, and phone number.
- Choose your account type
- Choose your base currency
- Choose your trading platform
- Verify your account by email or phone number
- Deposit money in order to start trading
Those are the basic steps of how to open forex trading account in India.