Forex brokers in Kuwait and Kuwaiti traders

Broker Kowe´t

Although a tiny nation at the tip of the Persian Gulf, but it's also one of the richest ones in the world. Although its economy is based on oil, it also has an advanced financial sector. Trading on the forex is legal and is increasingly popular, thanks to generally loose regulations.

Kuwaitis are relatively wealthy, and they view the currency markets as one of the better ways to invest their money. To have a better grasp of forex trading there, lets look at some figures. It's population is approaching 5 million, but most of them, around 3.3 million, are expatriates who went there for improved salaries. Kuwaitis are therefore in the minority, but they're supported by the state and are among the richest people in the world.

With a GDP per capita of just over $70,000, Kuwait is the 7th richest country in the world, according to recent stats. In addition, although the Kuwaiti dinar cannot be traded on the foreign exchange market, it is the most valuable currency in the world. Kuwaiti traders have a definite preference for major currency pairs such as the EUR/USD, the AUD/USD and the GBP/USD.

Kuwaiti forex regulations

Although Kuwait is an Islamic state, unlike the other GCC (Gulf Cooperation Council) countries, it adheres to a civil law system, while Sharia law governs family law and only applies to Muslim locals. Thus, it doesn't impose the same harsh trading rules as other neighbouring nations do. Also, Kuwaiti forex traders can opt to open the standard forex trading accounts that brokers provide rather than an Islamic account (which, although they don't charge swap fees, the spreads are usually not nearly as attractive).

Kuwaiti brokerage firms feature Islamic accounts for those who want to comply with Islamic finance principles. These Islamic accounts, which are actually swap-free accounts, aren't subject to rolling interest fees on overnight positions. However, these accounts are usually hit by other types of fees/commissions. Also, local traders should only open an account with a broker that's both licensed and regulated, whether it's a foreign brokerage firm or a local one.

Kuwaiti laws state that all foreign brokers be licensed and approved in the countries where they are based. This is why many forex brokers marketing trading services in Kuwait are also approved by the ASIC in Australia or the UK's FCA, for example. However, this is line with the regulations that are also in effect in other major territories (USA, Europe, Asia, etc.).

Although local regulators seem very lenient, they impose harsh fines on those who violate local laws or regulations. Scams, fraud, insider trading, etc. are severely punished, and government authorities will intervene in more extreme cases.

Beyond standard currency pairs, Kuwaiti brokerage firms generally offer their clients a range of other financial instruments, including futures and CFDs (derivatives that enable traders to profit from price movements of various assets without actually having to buy them). This includes commodities, indices, gold/silver, corporate shares, crude oil, etc. Kuwaiti traders can typically get up to 100:1 leverage - but higher levels are also legal for them to trade on (no limits on this here).

Kuwait's financial regulation agencies

A few local entities regulate and supervise local trading and financial activities. Brokerage firms that market trading services in Kuwait are regulated and licenced by the Ministry of Trade and Industry. Another important body that oversees financial activities is the KCCI (Kuwait Chamber of Commerce and Industry).

The Central Bank of Kuwait is the major regulation body, though. It was founded in 1970. It issues the dinar (local money) and conducts other national banking activities. It is responsible for interest rates, loans and for keeping the dinar currency stable and convertible with other currencies. In addition, the Central Bank also fulfills a supervisory role.

This entity is responsible for overseeing the nation's entire financial sector. It monitors and conducts due diligence on all brokers that want to launch operations locally.

BrokersRegulationTrading platformsOfficial website
DFSA, FSCA, FCA, CySEC, FSAMetaTrader 4 HF Markets website
FRSA, FSCA, JFSA, ASIC, CBFSAI, BVI FSCMetaTrader 4 and 5AvaTrade website
FCA, ASIC, CySECMetaTrader 4 and 5Admiral Markets website
FCA, KNF, CySEC, BIFSC, CNMVMetaTrader 4
XStation
XTB website
ASIC: Australia, BVI FSC: British Virgin Islands, CBFSAI: Ireland, CySEC: Cyprus, DFSA: Duba´, FCA: United Kingdom, FRSA: Abu Dhabi, KNF: Poland, BIFSC: Belize, CNMV: Spain, FSA: Seychelles, FSCA: South Africa, JFSA: Japan

CFD trading involves a significant risk of loss, so it is not suitable for all investors. 74 to 89% of retail trading accounts lose money trading CFDs.

Depositing funds into a Kuwaiti trading account

Most forex brokerage firms serving Kuwaiti traders accept deposits (and process withdrawls) using standard credit cards and bank transfers. Of course, you typically have other options to send or receive money: Skrill, Neteller and PayPal (although these solutions don't have 100% coverage in Kuwait).

Another popular option is the Paysafe prepaid method (which includes the Paysafecard), which was launched there in 2016. But the number 1 deposit method is the debit card, as most local traders already have a card linked to their bank account.

Also, most Kuwaiti traders have what is called a KNET card, which is a local payment service and a gateway to the KSCC (Shared Electronic Banking Services Company), a company that was founded in 1993 by several local banks. The idea was to link all of Kuwait's banks to provide people with safer, quicker and more efficient payment methods.

As of 2020, most Kuwaiti traders have KNET debit cards (and some also have credit cards). They are typically used for in-store and online payments almost anywhere. Kuwait's forex brokerage firms also accept deposits/withdrawls via KNET cards. Traders would also be wise to see what kind of account currencies are offered by the brokers they're considering. Those which offer dinar-dominated accounts are clearly better positioned as there won't be any currency conversion fees.

Trading software used by Kuwaiti traders

Kuwaiti traders already several options in terms of forex trading sofware programmes. However, picking the right one can be tricky as they seem to offer similar features (one-click trading, technical indicators, etc. Traders just need to make sure that the software supports the buying and selling of currency pairs.

Some platforms are designed to provide traders with real-time analyses and access to stock markets where trading isn't the same as with the forex. The currency markets are decentralised, global and trading takes place throughout the day via many liquidity providers and brokerage firms. To access them, currency traders need specific software. The difference between successful and unsuccessful trades often depends on a trading platform's performance and speed.

The best platforms offer immediate execution, technical analysis indicators tools, real-time analyses, and other analytical features. They also provide traders with access to economic data (interest rates, volumes traded, etc.) as well as professional features such as one-click trading. Kuwaiti currency traders also typically have access to trading software in Arabic. In addition brokers have to provide Islamic (no-swap) accounts.

Currently, MetaTrader is the most popular forex trading programme among Kuwait's traders. You can launch it in English, Arabic or any of a dozen other languages. Whereas MT4 (MetaTrader 4) is only for forex trading, the more recent MT5 also covers the stock markets as well as other assets (commodities, crude oil, precious metals, cryptos, etc.), and both versions are user-friendly and don't require much effort to understand. They both feature tons of free chart indicators (Fibonacci retracements, moving averages, Relative Strength Indicators, etc.) and can be used with automatic trading software (trading "robots"). In addition, as many traders need market access on the go, they are also available for mobile devices (smartphones, tablets).

Other forex trading platforms include cTrader, ZuluTrade and NinjaTrader. Another locally-developped trading programme is AX1, which is off course available in Arabic. It's also available for mobile devices and is offered by several local brokers.

Mobile trading in Kuwe´t

As Kuwait is one of the world's wealthiest nations, it is very open cutting-edge technologies. Mobile technologies, in particular, are now an integral part of daily life and business there. Everyone owns a smartphone there. Kuwait's citizens now purchase many things online and government agencies often provide access to many of their services via advanced and secure websites.

Naturally, many of Kuwait's traders also open their trading accounts using their smartphone, whether it's an Android or Mac-based phone. And Kuwait's forex brokerage firms are usually happy to accomodate transactions via this channel. The trading apps can be downloaded free of charge from Google Play, Apple's App Store or the brokerage firm's website.

However, it bears mentioning that Kuwaitis haven't yet established the infrastructures needed to provide all traders with high-speed fiberoptic web access. There are a few major internet service providers that all use the same broadband landline infrastructure, which is quite slow. On the bright side of things, this slower connection is the basis of the newer 4G and 5G networks.

Commonly asked questions:

1. What asset classes can we trade in Kuwait?
Kuwaiti traders can trade currencies on the forex, as well gold/silver, commodities such as crude oil, bonds, cryptocurrencies and both futures and CFDs.

2. Is it legal to trade the forex in Kuwait?
As it's fully regulated and monitored by various local bodies, forex trading is indeed 100% legal.

3. How can I trade from my phone?
Most Kuwaiti forex brokerage firms provide free trading apps that can easily be installed on any device. Trading accounts can also be opened with a phone and existing clients can log on with their usual login/password combos.

4. Is forex trading 100% risk-free with all forex brokers?
Forex trading is a risk-bearing investment. Newbies to the world of currency trading should test their trading strategies with a free demo account. Every broker provides this, and it enables you to get familiar with the trading software and start trading with fake money (traders usually start of with a realistic $25,000 zero-risk account).

5. How can I open a forex trading account?
Once you've found a trustworthy broker that is regulated and licenced to operate in Kuwait, you just need to see the documents that the brokerage firm requires (typically a national ID/identification card, proof of address (a gas/phone/electricity bill), an email address and...that's it!).

Recommended forex brokers for traders living in Kuwait:

BrokersRegulationTrading platformsOfficial website
DFSA, FSCA, FCA, CySEC, FSA MetaTrader 4 HF Markets website
FRSA, FSCA, JFSA, ASIC, CBFSAI, BVI FSCMetaTrader 4 and 5AvaTrade website
FCA, ASIC, CySECMetaTrader 4 and 5 Admiral Markets website
FCA, KNF, CySEC, BIFSC, CNMV MetaTrader 4
XStation
XTB website
ASIC: Australia, BVI FSC: British Virgin Islands, CBFSAI: Ireland, CySEC: Cyprus, DFSA: Duba´, FCA: United Kingdom, FRSA: Abu Dhabi, KNF: Poland, BIFSC: Belize, CNMV: Spain, FSA: Seychelles, FSCA: South Africa, JFSA: Japan

CFD trading involves a significant risk of loss, so it is not suitable for all investors. 74 to 89% of retail trading accounts lose money trading CFDs.