The Capital Markets Authority (CMA) has cleared Exinity Capital East Africa Limited to operate as a non-dealing online foreign exchange broker.
This the fourth non-dealing online foreign exchange broker to be licensed by the markets regulator.
The others are EGM Securities Ltd (trading as FXPesa), SCFM Ltd (trading as Scope Markets), and Pepperstone Markets Kenya Limited.
The non-dealing online foreign exchange broker license allows the holder to act as a link between the online foreign exchange market and a client in return for a commission.
It however does not have the approval to engage in market-making activities (buying and selling of foreign currencies).
Non- dealing online forex brokers do not offer client advice or trade on behalf of their clients.
Clients deposit their investment amount with an account to be offered by the broker.
The trader (client) is responsible for executing trades – buying and selling of any products on the platform and the requisite risk assessments are undertaken to determine suitability of clients to participate in online forex trading.
CMA called on those engaged in the forex trade to only do so through licensed entities to avoid losing their money.
"This is an important milestone in the online foreign exchange market as it gives Kenyans a choice of four non-dealing online foreign exchange brokers licensed by CMA," acting chief executive Wyckliffe Shamiah said yesterday.
He said CMA is closely collaborating with licensees to identify strategies that can help the regulator protect unsuspecting Kenyans from unlicensed entities, where they are not protected by the regulator.
