Forex brokers connect forex traders to the market. Their importance in trading cannot be overestimated. However, some brokers are high-risk and can scam traders. This is why regulation is important.

The Financial Conduct Authority is the watchdog in the UK. They regulate the activities of brokers and protect UK-based traders from fraudulent brokers. If you live in the UK, never register with a broker that is not FCA regulated. You are putting your money at risk by doing so.

In this review, we will be looking at some FCA regulated brokers and their general trading conditions.

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Comparison of FCA Regulated Forex Brokers

Broker FCA License No Authorised Since Min. Deposit Visit
Pepperstone

648312
05/08/2015
No minimum deposit
Visit Broker
City Index

446717
24/03/2006
£100
Visit Broker
CMC Markets

173730
20/09/2005
No minimum deposit
Visit Broker
eToro

583263
09/05/2013
$10
Visit Broker
ETX Capital

124721
01/12/2001
£100
Visit Broker
Tickmill

717270
29/07/2016
£100 (Pro and Classic Accounts)
Visit Broker

Note: The spread and minimum deposit is as per information on these brokers’ websites in Mar. 2022. Please see the general trading conditions below.

Best FCA Regulated Forex Brokers

Here are 2022’s best FCA regulated forex brokers in the UK:

  1. Pepperstone – Overall Best FCA Regulated Forex Broker
  2. City Index – Regulated Broker with HTML5 Webtrader
  3. CMC Markets– FCA Regulated Broker with Most Currency Pairs
  4. eToro – FCA Regulated UK Broker with CopyTrading
  5. ETX Capital – Forex Broker with FCA Regulation
  6. Tickmill – FCA Regulated Broker with Low Fees

#1 Pepperstone- Overall Best FCA Regulated Forex Broker

GBP/USD Benchmark:
0.59 pips (Razor Account)
Status:
Authorised
Authorised since:
05/08/2015

Pepperstone is licensed with the FCA under the trading name Pepperstone Limited. They have been authorised since 05/08/2015 and are still authorised. Their reference number is 648312 and their registered company number is 08965105.

Pepperstone are considered low-risk because they are FCA regulated. They offer three account types (CFD Razor Account, Spread Bet Account, and CFD Standard Account). This allows you to trade in your preferred way, whether CFD trading or spread betting. There is no minimum deposit for any of the accounts.

The average spread for major forex pairs depends on your account type. They are generally lower on the CFD Razor Account with 0.17 pips for EUR/USD and 0.59 pips for GBP/USD. There is also an extra commission per lot and it depends on your account’s base currency. MetaTrader 4, MetaTrader 5, and cTrader are their available trading platforms and there is no inactivity fee.

You can deposit or withdraw your funds via three means: credit/debit card, bank transfer, and PayPal. Pepperstone supports Visa and Mastercard only. Finally, you can get support through email, live chat, and a UK toll-free mobile number.

#2 City Index- Regulated Broker with HTML5 Webtrader

GBP/USD Benchmark:
1.8 pips
Status:
Authorised
Authorised since:
24/03/2006

City Index is one the trading names for StoneX Financial Limited. StoneX have been authorised in the UK since 24/03/2006 but the City Index trading name became effective 01/03/2021. Their FCA reference number is 446717.

You can trade the forex market via CFDs or spread betting. You can open a trading account with a £100 minimum deposit.

The typical spread for major pairs depending on your way of trading is low with 0.8 pips for EUR/USD and 1.8 pips for GBP/USD. For some instruments like shares, the spread depends on whether you are trading CFDs or spread betting. City Index charges no commissions except for shares CFDs. There is a monthly account inactivity fee of £12 and a premium fee for guaranteed stop loss orders.

There are no extra charges for deposits/withdrawals. You can fund your account via debit card (Mastercard, Visa, Maestro, and Electron), credit card (Visa and Mastercard), PayPal, and Bank transfer. Withdrawals are easy via bank transfer and other methods you will find once you are signed up.

You can trade with MT4, webtrader, and the City Index mobile app and support is available via live chat and FAQs.

#3 CMC Markets- FCA Regulated Broker with Most Currency Pairs

GBP/USD Benchmark:
0.9 pips
Status:
Authorised
Authorised since:
20/09/2005

The forex broker is regulated with FCA as CMC Markets (UK) plc. This also their trading name, which has been effective from 20/09/2005. They have been authorised in the UK since 01/12/2001 and are still authorised. Their firm reference number is 173730.

Three account types are available at CMC Markets – Spread Betting Account, CFD Account, and Corporate Account. There are no minimum deposits for these accounts.

Overall fees are low with no extra commission per lot or deposit/withdrawal charges. The minimum spread for GBP/USD and EUR/USD is 0.90 pips and 0.70 pips respectively. There are also holding costs (swap), account inactivity fee (£10), and a guaranteed stop loss premium.

Of all the FCA regulated brokers in this review, CMC Markets has the widest market range with over 11,000 trading instruments available. You can trade these instruments on Metatrader 4 and CMC’s Next Generation platform.

You can deposit/withdraw funds via bank wire transfer, credit/debit card, and PayPal without extra charges. Support is available via FAQs, email, and a UK mobile number.

#4 eToro – FCA Regulated UK Broker with CopyTrading

GBP/USD Benchmark:
2.0 pips
Status:
Authorised
Authorised since:
09/05/2013

eToro is licensed with the FCA as eToro UK Limited. According to the FCA, the forex broker currently trades under three names: eToro (effective from 27 July, 2021), eToro UK (effective from 27 July, 2021), and eToro (UK) Ltd (effective from 21 June, 2012). eToro have been authorized in the UK since 09/05/2013 and are still authorized. Their reference number is 583263.

eToro operates differently compared to other FCA regulated brokers. Apart from opening a trading account, you can also invest. With a minimum deposit of $10, UK traders can open an account.

eToro’s fees are quite high. There is a monthly inactivity fee of $10 and a withdrawal fee of $5. In addition, there is a minimum withdrawal of $30. The spread for GBP/USD and EUR/USD is 1.0 pips and 2.0 pips respectively with no extra commission for currency pairs. eToro offers its own proprietary trading platforms. No MT4 or cTrader.

Deposit/withdrawal is easy via credit card, PayPal, and bank transfer. Neteller and Skrill are also available for deposits. There is no local mobile number but you can get support via FAQs, email, and live chat.

#5 ETX Capital – Forex Broker with FCA Regulation

GBP/USD Benchmark:
1.85 pips
Status:
Authorised
Authorised since:
01/12/2001

ETX Capital is regulated with the FCA as Monecor (London) Ltd. They have been authorized since 01/12/2001 and are still authorized. Their four trading names include ETX, ETX Capital, ETX Group, and Monecor (London) Ltd. Their FCA reference number is 124721.

You can open a CFD trading or Spread Betting Account with £100. ETX Capital does not charge extra commission per lot but fees are built into the spread. The average spread for major pairs are high with 1.01 for EUR/USD and 1.85 for GBP/USD. There are also overnight charges.

You can trade forex, commodity CFDs, shares CFDs, and indices CFDs with ETX Capital. The trading platforms they support are ETX TraderPro, ETX TraderPro App, ETX Connect App, ETX MT4, and ETX MT4 Remastered.

Deposit/withdrawal is easy with credit/debit card, UnionPay, and Skrill with no extra charges. Support is available for UK traders via email, Facebook messenger, and a UK mobile number.

#6 Tickmill – FCA Regulated Broker with Low Fees

GBP/USD Benchmark:
0.3 pips
Status:
Authorised
Authorised since:
29/07/2016

Tickmill is regulated with the FCA as Tickmill (UK) Ltd. They have been authorized in the UK since 29/07/2016 and are still authorized. They have three trading names currently – Tickmill, Tickmill Prime, and Tickmill UK Ltd. Their FCA reference number is 717270.

You can open a Pro, Classic, or VIP Account. The minimum deposit for Pro and Classic Accounts is £100. No minimum deposit if you are opening a VIP Account.

Tickmill has low fees with 0.1 pips and 0.3 pips minimum spread for EUR/USD and GBP/USD. You also pay extra commission per standard lot on Pro and VIP Accounts only. The commission is higher on Pro Account. In addition, there are holding costs and account inactivity fees too.

Metatrader 4 and 5 are supported.

Deposit/withdrawal methods are convenient with no extra charges. You can get support via email, live chat, and UK mobile number.

How Does the FCA Protect You?

The FCA acts in the best interest of forex traders. As an authority over forex brokers, they make sure financial services providers are set up to reduce the risk traders are exposed to. In this section, we will be looking at the structures the FCA has put in place to protect you and your funds.

1) Leverage restriction: FCA regulated brokers have a leverage cap for CFDs. The maximum leverage for retail traders is 30:1 (currency pairs). There are leverage restrictions for commodities, indices, and stocks too. The restriction ensures that you do not abuse leverage. Leverage amplifies losses. Lower leverage ensures that traders are not exposed to damaging losses.

2) Negative balance protection: Negative balance protection was put in place to make sure trades do not lose more than their trading capital. Without this, your account balance can go into the negative. That means you will have to pay your broker.

However, FCA regulated brokers are under orders to make sure no traders lose more than their account balance. Instead of the trader paying, most brokers absorb the debt and take responsibility for it.

3) Financial Services Compensation Scheme: The FCA also mandates brokers to be part of the FSCS before they can operate in the UK. The aim of the FSCS is to ensure that traders get their money back should a forex broker go bankrupt. Under the scheme, your money is protected for up to 85,000. This is why only FCA regulated brokers can guarantee the safety of your funds.

4) Segregation of funds: The segregation of funds involves forex brokers keeping clients’ money in a separate account. That is, your money and the brokers’ money are not in the same account. This has good implications for forex traders. The implication is that the creditors of brokers cannot lay claim to traders’ money in case of bankruptcy. Also, traders’ money will not be used for hedging trades with counterparties.

5) Financial Ombudsman Service: The Financial Ombudsman Service (FOS) was set up by the UK parliament in 2001. The main goal of the FOS is to settle disputes between forex traders and forex brokers. As a trader, you might not be able to take on your broker if a major dispute breaks out. The FOS evens the playing field and makes sure you are not at a disadvantage. If you have any complaints, you can go to the FOS website and lodge your complaint.

6) Risk Disclosure: Most traders are drawn to forex trading ignoring the risks. Even with all the restrictions put in place by top-tier regulatory bodies, more than 80% of forex traders lose their capital trading CFDs. For the sake of transparency, all FCA regulated brokers are required to display the percentage of their clients that lose money on their website. With this information made public, you are more aware of the risks that accompany trading CFDs.

Typically, you will find it at the header or footer of the CFD broker’s website. Here is a screenshot showing Pepperstone’s risk disclosure as an example for you.

Traders Losing Money

In conclusion, these benefits are enough reasons for you to choose an FCA regulated broker. In regions where these strict regulations are not in place, data show traders lose a lot of money.

How to Check a Forex Broker’s FCA Regulation?

In simple steps, this is how to verify a forex broker’s FCA regulation. Tickmill is our example:

Step 1) Check Broker’s FCA Regulation: First, you need to know from the broker if the FCA regulates them. Forex brokers usually display this in the footnote of their website.

Checking Broker's Regulation

Step 2) Verify Broker Regulation at the FCA website: Once you find the regulation, on the forex broker’s website, go to https://register.fca.org.uk/s/ and scroll down. When you get to the part displayed below, enter the broker’s name, select firms, and click on search

Searching FCA Broker's Regulation

Your search result will give you the image displayed below where the forex broker’s company name is displayed with the FCA reference number.

FCA Broker's Verification

If the reference number matches the one on the broker’s website, then the broker is truly FCA regulated.

Step 3) Check Status & Type of Regulation: Furthermore if you click on the broker’s company name and scroll down, you will know when they got authorized in the UK and if they are still authorized.

FCA Broker's Authorised Status

Step 4) Check the Clones of the Firm: This is a bit of an extra precaution. There might be individuals or companies using the name or details of a forex broker. This is usually a part of an attempt to defraud people. The FCA always reveals the details of these scams so you can avoid them. The image below shows the clones of Tickmill UK as shown on the FCA website.

Tickmill Clone Firms

FAQs on Best FCA Regulated Forex Brokers

What is the FCA?

FCA means Financial Conduct Authority. They are UK’s financial watchdog. All the forex brokers that can accept clients from the UK must be regulated with the FCA. Trading via a regulated broker would ensure that your funds are kept safely.

Which FCA regulated broker has low fees?

Pepperstone and Tickmill have the lowest fees with low spread for major pairs and no inactivity fees. They also have ECN type trading accounts with raw spreads & low commissions per lot.

Do forex traders pay tax in the UK?

Gains from CFDs are not subjected to capital tax. Only gains from spread betting are taxed.

Which FCA regulated broker has the most instruments?

CMC Markets have the most instruments as per our research as they offer CFD trading on more than 11,000 instruments.

Which FCA regulated broker offers GSLOs?

According to our review, CMC Markets, City Index, and ETX Capital offer guaranteed stop loss orders.

Pepperstone is our featured FCA regulated forex brokerVisit