MCC Codes, short for Merchant Category Codes, are four-digit numbers that are used to categorize…
The foreign exchange (forex) market is the biggest and most liquid financial trading market on the planet, with over $5 trillion exchanged every day. Brokers perform over-the-counter (OTC) exchanges far and wide, 24 hours a day, 5 days a week.
There is no single forex market, and all exchanges are done electronically. As a result, large number of new firms and a huge number of new brokers have entered the forex business.
Opening a Forex Merchant Account
Brokers hoping to open a forex merchant account often run into challenges. These include their startup status, lack of licensing and regulation and lack of solid financials.
One of the biggest reasons acquirers will not work with forex brokers is their lack of credit card processing history. Acquirers and processors like to work with established companies with a proven track record. However, forex startups do have options to open their first forex merchant account.
Forex Broker Licensing
Licensing and regulation is the biggest challenge for most forex businesses who are starting up. Many jurisdictions make it cost restrictive to set up as a licensed or regulated forex broker. But, a proper forex brokerage license makes it much easier open a forex merchant account.
Some countries offer forex licenses for new businesses with a much lower barrier to entry. For example, brokers can obtain forex licenses in countries such as Belize or Vanuatu for under $30,000. While still costly, the higher tier countries (such as Cyprus) can charge hundreds of thousands for licensing.
Another option for forex broker is to open their business in a country that doesn’t require licensing, and operate as an unregulated broker. The problem with that is that most acquirers, processors, and banks will not do business with unregulated forex. Receiving payments and even opening a bank account will be difficult.
Our Services for Forex Merchants
IntegralPay is a specialist in forex merchant accounts and other solutions for forex brokers. Through our acquiring network we can provide merchant accounts for credit cards and alternative payments including local bank transfers.
Contact us today and find out how rapidly your business can be set up with a forex merchant account, incorporation, bank account, and licensing/regulation setups!