Forex Merchant Account Services
The word Forex is firstly an acronym for Foreign Exchange. Forex is a global marketplace where foreign currencies are speculated, bought, sold and traded.
The Forex Market is the largest financial market globally, involving $ 6.6 trillion in daily trading. It is also the most significant active market in the world. This market is used by commercial, investment, and central banks, multinational corporations, hedge funds, investment managers, and individual traders. It serves as the world market for currency exchange.
The forex market serves as a potential for individuals and institutional traders to make profits from currency trading. To make this trading happen, forex traders need a payment gateway that permits them to deposit and withdraw their funds at inexpensive transaction rates.
What Is a Forex Payment Gateway?
The currency trading platform and its users are connected by a forex payment gateway. Merchant integrates Forex Payment Gateway with the platforms allowing brokers to accept payments from their clients. Meanwhile, traders also use this forex payment processing system to deposit and withdraw money from their accounts, here the payment gateway collects the sum and transfers it to Merchant’s Bank account from the user’s account. Before sending the money to the merchant, the forex payment gateway deducts a percentage-based, a fixed fee, or both, as payment for the service.
Why Is it Difficult for Forex Brokers to Find a Payment Gateway?
The main reason it is difficult for forex brokers to find payment gateways is that forex trading is considered a high-risk business and gateways and processors will have frequent concerns regarding working with these merchants. Since there is a lot of trading going on on the platforms used by forex brokers, they process a lot of transactions every day, which raises their chargeback rates. Due to payment processors’ classification of forex service providers as high-risk companies, brokers should expect their applications to be denied at conventional gateway solutions.
Why Is Forex Considered High Risk?
As mentioned above it is not the merchants but the banks who classify the forex business as high risk. Apart from the fact that Forex Merchant Accounts generally face high levels of chargebacks and fraud, it involves users globally, as forex is a global trading platform. This means that it is not regulated by the regulations of one nation and no one nation may be in the power over another nation’s currency.
It has come into consideration that many trading platforms are not licenced businesses. To conclude, the lack of regulation is the major part where banks classify Forex Business as a high-risk business. The likelihood of fraud, money laundering, and chargebacks from disgruntled investors has increased, which is another factor that causes banks to view Forex merchant accounts as high risk.
Possessing all required licenses as well as effective anti-fraud and anti-money laundering filters will make it simpler for you to get your merchant account approved.
Finding a payment provider who is aware of the particular requirements of your industry and who will implement clever anti-fraud filters capable of telling your real customers from fraudsters is therefore crucial. Anti-fraud filters have the potential to develop into overly sensitive, which lowers the likelihood that payments will be accepted, lowers conversion rates, and irritates customers.
Prefer a payment processor to find the ideal balance between the two to avoid this.
What Should Merchants Consider When Choosing a Forex Payment Gateway?
Forex businesses must consider several factors before selecting a payment gateway solution, such as:
- Instant Transfers: Forex traders must act quickly to seize opportunities and profit from currency fluctuations. Because of this, merchants must pick a payment gateway that handles customer transactions quickly.
- Fees: Considering that price spreads and other trading fees are how forex brokers make money, maintaining a profitable business requires an affordable payment gateway.
- Chargeback Protection: A payment gateway must be able to offer chargeback protection to merchants to shield them from disgruntled investors or dishonest actors because chargebacks are a significant challenge in forex trading.
- Security: The strictest anti-fraud and anti-money laundering security requirements, including PCI compliance, must be followed. This ensures that the money and information of traders will be secure.
- Multiple payment systems: A payment gateway must be able to provide a wide range of payment options due to the global nature of forex trading. Credit and debit cards must be among them, as well as additional payment options like digital wallets, various currencies, and others.
- Multi-currency system: Expenses associated with currency conversion can deter traders from using brokerage platforms. Because of this, choosing a solution for a forex payment gateway that provides reasonable exchange rates is crucial. Even better, the service offers multi-currency accounts for merchants and their customers to reduce the cost of currency conversion.
Forex Merchant Account Application Requirements
To approve and set up forex merchant services for your brokerage, several documents are needed. After the processor receives them, approval will occur in one or two days.
- ID (issued by Government)
- Utility Bill
- Corporate Documents
- Domain Registration Screenshot
Start your Forex Merchant Account Services With Radiant Pay
Applicants for payment processing solutions from companies looking to open a merchant account for forex brokers. A brief application must be filled out and a few supporting documents submitted to our company. To get started, get in touch with one of our experts on forex payment processing right away at Radiant Pay, a leading payment service provider in London, UK.