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AuthorBy Chris Cammack
Updated: December 5, 2022

Most traders want an Islamic Forex account because they comply with the Shari’ah prohibition on Riba or the accumulation of interest. Some brokers try to compensate for the missed revenue that would otherwise have been generated by collecting interest, so we always look for limitations on trading opportunities, additional fees, and widened spreads. Otherwise, we focused on finding the best Islamic accounts for all types of traders, including a range of platforms, excellent trading tools, and good education for beginners.

These are the best Islamic Forex accounts for 2022, according to our testing and our research.

  • FP Markets - Most Transparent Islamic Accounts
  • Pepperstone - Best ECN Islamic Account
  • XM - Lowest Cost Islamic Account
  • IC Markets - Best Raw Spread Islamic Account
  • AvaTrade - Best Mobile Trading Experience
  • Axi - Best MT4 Islamic Swap-Free Account
  • IronFX - ECN Broker with Over 80 FX Pairs
  • markets.com - Best Proprietary Platform for Islamic Accounts

Best Brokers with Islamic Accounts 2022

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Broker
Overall Rating
Official Site
Islamic Account
Min. Deposit
Max. Leverage (Forex)
Currency Pairs
MetaTrader 4 (MT4)
MetaTrader 5 (MT5)
cTrader
Regulators
Compare
FP Markets
4.22 /5
Read Review
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Your capital is at risk
AUD 10030:170 ASIC Regulated Forex BrokersCySEC Regulated Brokers
Pepperstone
4.61 /5
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Your capital is at risk
AUD 10030:170 FCA Regulated BrokersASIC Regulated Forex BrokersCySEC Regulated BrokersDubai Financial Services AuthorityBundesanstalt für FinanzdienstleistungsaufsichtSecurities Commission of the BahamasCapital Markets Authority
XM
4.25 /5
Read Review
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AUD 530:157 CySEC Regulated BrokersASIC Regulated Forex BrokersFCA Regulated BrokersInternational Financial Services Commission
IC Markets
4.46 /5
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Your capital is at risk
AUD 20030:164 CySEC Regulated BrokersASIC Regulated Forex BrokersThe Seychelles Financial Services AuthoritySecurities Commission of the Bahamas
AvaTrade
4.38 /5
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AUD 10030:155 ASIC Regulated Forex BrokersFinancial Services Conduct AuthorityBritish Virgin Islands Financial Services CommissionFinancial Services AgencyCentral Bank of Ireland
Axi
4.34 /5
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Your capital is at risk
AUD 030:170 FCA Regulated BrokersASIC Regulated Forex BrokersFMA Regulated Forex BrokersDubai Financial Services AuthorityFinancial Services Authority – St. Vincent & the Grenadines
IronFX
3.54 /5
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USD 5030:183 CySEC Regulated BrokersFCA Regulated BrokersASIC Regulated Forex BrokersFinancial Services Conduct Authority
Markets.com
4.58 /5
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Your capital is at risk
AUD 10030:167 FCA Regulated BrokersCySEC Regulated BrokersASIC Regulated Forex BrokersFinancial Services Conduct AuthorityBritish Virgin Islands Financial Services Commission

How to compare Islamic accounts

Most brokers will have an Islamic account option for clients of the Muslim faith. While these account types are simply an adaptation of the live account, trading conditions at the broker and specific modifications to the Islamic account trading conditions can potentially influence trading costs. In comparing Islamic accounts, it is important to consider:

Regulation: Regulation is the security of funds for traders. Without regulation, the broker is free to make decisions about your trading funds. 

Your broker should be governed by your local regulator or a combination of other well-respected international regulators like ASIC, the FCA and MAS, who have processes in place to protect your funds.

Free swap rates: Swap fees are charged every 24 hours a position is held open. For a trading account to be considered swap-free or Shari’ah-compliant, the broker must never charge a swap fee. Select brokers will restrict swap-free trading to a period of time – usually up to 14 days after the trade was opened – and would make the account swap-free for this period. As you compare Islamic accounts, always ask the broker if there is a time-limited swap-free period for trades.

Not offered on all account types: A majority of brokers offer various live accounts, but not all of these accounts can have the swap fees removed. Always ask your broker which of the live accounts have a swap-free option. The broker can also restrict leverage for Islamic accounts.

Minimum deposit: A live account will always have a minimum deposit requirement, but occasionally brokers will increase this minimum deposit for Islamic accounts. Always check the minimum deposit for this account type before signing up.

Instrument restrictions: Brokers often restrict the trading instruments an Islamic client can trade. At AvaTrade, Islamic accounts are subject to an increased spread on all Forex pairs, and Islamic accounts can not trade cryptocurrency. Tickmill charges an Islamic account fee on exotic FX pairs.

Additional Fees: Brokers occasionally make money from the swap, and to replace lost income, the broker may take steps to increase spreads or introduce additional commissions. Here are some examples of additional fees:

FP Markets charge an admin fee of 5 USD per lot on major currency pairs per night. However, fees are not charged for the first ten nights the position is open and will only be applicable from the eleventh night.

Admirals charge a flat commission after positions are held open for longer than three nights on Islamic accounts.

If a position at Axiory is open overnight, a commission is charged instead of a typical swap. The commissions and holding period are subject to change according to market conditions and when necessary.


FP Markets – Most Transparent Islamic Accounts

An ECN/DMA broker, FP Markets offers trading on multiple instruments, including Forex, shares, metals, commodities, and indices.  Unlike many other brokers, FP Markets publishes all information about the Islamic accounts on its website, and caters to Muslim traders with two distinct Islamic account options.  The swap-free account option is available on both its Raw and Standard account types on the MT4 and MT5 trading platforms. 

The Islamic Standard Account requires a minimum opening balance of 100 AUD. Spreads start at 1.0 pips on the EUR/USD, and no commissions are charged on the trades.  The Islamic Raw Account also has a minimum opening balance of 100 AUD, spreads starting at 0.0 pips on the EUR/USD, which is tighter than other ECN brokers, and a low commission of 3 USD per lot traded.  Note that FP Markets charges administration fees on its Islamic account, which vary depending on the instrument traded.  A fee of 5 USD is charged on the EUR/USD, but this will only be applicable from the eleventh night a position is held open. 

Pros
  • Well regulated
  • Tight spreads
  • Good range of accounts
  • Great customer support
Cons
  • Expensive withdrawals
AlertAccepts Australian Clients. Average spread EUR/USD 0.10 pips with 6 USD commission round turn on the trading account with lowest minimum deposit. Max leverage 30:1. Islamic account available. MT4, MT5 & IRESS platforms supported. FP Markets is regulated by CySEC and ASIC.

Pepperstone – Best ECN Islamic Account

A well-regulated pure ECN broker, Pepperstone only offers swap-free accounts in countries with a large population of people of the Islamic faith. Like all Pepperstone accounts, the Islamic account features fast ECN market execution with deep liquidity and variable spreads. The Islamic account also offers decent trading conditions and a low minimum deposit of 200 AUD (or equivalent). Spreads average 1-1.2 pips on the EUR/USD and no commission is charged. Unfortunately, Pepperstone’s Razor Account, with spreads down to 0 pips and commission of 6 AUD per lot traded, is not available as an Islamic account.

Islamic accounts can be opened in AUD, EUR, GBP, and USD and all three major trading platforms are supported (MT4, MT5 and cTrader). While no swaps are charged on this account any position that is held for more than 10 days will be charged an admin fee of 50 USD per lot.

Pros
  • Well regulated
  • Tight spreads
  • Great platform choice
  • Wide range of assets
Cons
  • Limited market analysis
AlertAccepts Australian Clients. Average spread EUR/USD 0.60 pips with 0.0 USD commission round turn on the trading account with lowest minimum deposit. Max leverage 30:1. Islamic account available. MT4, MT5 & cTrader platforms supported. Pepperstone is regulated by the FCA, ASIC, and the DFSA.

XM – Lowest Cost Islamic Account

XM is unusual in the Forex industry in that it does not apply any extra charges for Islamic accounts. Most other brokers apply a commission or widen the spread to cover the cost of the lost swap fees. XM does neither, meaning its Islamic account has exactly the same trading conditions as a normal trading account, minus the swap fee. In addition, opening an Islamic account with XM is relatively straightforward: First, a trader must open and validate a standard account and then file a request for an Islamic account with the XM back office. Approval usually takes a matter of minutes.

XM is one of the most regulated market makers in the Forex industry and stands out for leading trading conditions, account choice, execution speed and a wide range of CFD assets available on both the MT4 and MT5 platforms. With a minimum deposit of 50 USD, traders can open the XM Ultra Low Account, where spreads start at 0.6 pips with no commission charged.

Pros
  • Well regulated
  • Excellent education
  • Free deposits and withdrawals
Cons
  • Dealing desk
  • Wide spreads on its entry-level accounts
AlertLeverage limitations apply to all the EU regulated entities of the group.

IC Markets – Best Raw Spread Islamic Account

Unlike many other brokers, IC Markets does not charge any extra fees or commission for an Islamic account. In addition, IC Markets is one of the very few brokers that offers Islamic accounts on both the Raw Spread and commission-free account types on the MT4, MT5 and cTrader platforms.

Islamic account holders will have access to leverage of 30:1, 90 tradeable instruments and spreads as low as 0 pips on the EUR/USD. Commissions start at 5 USD per lot traded on the Raw Spread account. Opening an Islamic account is a simple process and can be done directly from IC Market’s website, though customer service may ask for proof of Islamic faith before registering the trading account.

Pros
  • Well regulated
  • Tight spreads
  • Wide range of assets
  • Great platform choice
Cons
  • High minimum deposit
  • Limited market analysis
AlertAccepts Australian Clients. Average spread EUR/USD 0.10 pips with 7 USD commission round turn on the trading account with lowest minimum deposit. Max leverage 30:1. Islamic account available. MT4, MT5 & cTrader platforms supported. IC Markets is regulated by CySEC and ASIC.

AvaTrade – Best Mobile Trading Experience

AvaTrade offers Islamic accounts on MT4, MT5, Webtrader and the excellent and newly designed AvaTradeGo mobile app. The AvaTradeGo app offers forex traders an intuitive and sophisticated trading experience, with spreads as low as 0.9 pips on the EUR/USD for Islamic accounts. AvaTradeGo features an advanced dashboard, with intuitive management tools, clear charts, zoom for details, and a Market Trends feature to monitor trading trends within the AvaTrade community. The AvaProtect tool is also available in the mobile app, allowing traders to purchase loss protection for a time. 

Islamic accounts at AvaTrade do require a little more setup than with other brokers. First, a normal account must be opened and funded, once this step is complete an application for an Islamic account must be made and approved. Applications are usually processed within 1-2 business days. Islamic accounts at AvaTrade are not charged swap fees or a commission, as is common with other Islamic accounts, but instead, the spread will be marked up to cover overnight fees.

Pros
  • Good for beginners
  • Well regulated
  • Low minimum deposit
Cons
  • Dealing desk
  • Limited market analysis
AlertAccepts Australian Clients. Average spread EUR/USD 0.90 pips. Minimum initial deposit 100 AUD. Max leverage 30:1. Islamic account available. MT4 & MT5 platforms supported. AvaTrade Group regulated by ASIC, FSCA, B.V.I FSC & FSA.

Axi – Best MT4 Islamic Swap-Free Account

Axi is a well-regulated ECN broker offering a trading account tailored to Islamic traders on the MT4 platform.  Axi does not charge any extra fees on the Islamic account, which is unusual as most brokers apply a commission or widen the spreads to make up for the lost swap fees, making Axi a good choice for traders of the Islamic faith.   

Packed full of advanced features, the MT4 platform offers excellent customisation and is enhanced by world-class trading tools, including the MT4 NexGen plugin.  NexGen offers a sentiment indicator, a correlation trader, an intuitive window, and an automated trade journal.  Axi also offers a range of tools, including AutoChartist, a powerful automated technical analysis tool, PsyQuation, an AI diagnostic tool that tracks your trading style, VPS hosting, and other trading algorithms to install on the platform. 

Opening an Islamic Account is a simple process.  Traders are required to open a Standard Account and request approval from Axi’s customer support, which usually takes a few minutes. 

Pros
  • Low minimum deposit
  • Tight spreads
  • Innovative trading tools
Cons
  • MT4 only
  • Limited range of assets
AlertAccepts Australian Clients. Average spread EUR/USD 1.00 pips on trading account with lowest minimum deposit. Max leverage 30:1. Islamic account available. MT4 & MT5 platforms supported. Axi Group is regulated by the FCA, ASIC and the DFSA

IronFX – ECN Broker with Over 80 FX Pairs

A well-regulated global broker, IronFX offers trading on multiple assets, including metals, indices, commodities, futures, shares, and over 80 forex pairs.  With a wide variety of account and execution choices, traders can choose the spread/commission combination that bests suits their strategy.  Islamic swap-free accounts are available on all account options, and unlike most other brokers, no extra fees are charged.  Opening an Islamic swap-free account is a simple process, and traders only need to produce a copy of a valid identification document proving that they are of the Muslim faith.

Trading conditions for Islamic account-holders are the same as for regular traders: Spreads start at 0 pips on the EUR/USD on the absolute zero accounts in exchange for a high commission of 18 USD per lot traded.   Traders can also choose the Fixed Spread accounts, which offer spreads starting at 2.2 pips on the EUR/USD, which is relatively wide, but with no commissions.  Leverage is up to 30:1, and trading is offered on IronFX’s large range of currency pairs. 

Pros
  • Well regulated
  • Tight spreads
  • Wide range of assets
Cons
  • Expensive withdrawals
AlertAccepts Australian Clients. Average spread EUR/USD 2.20 pips on trading account with lowest minimum deposit. Max leverage 30:1. Islamic account available. Only MT4 platform supported. IronFX is regulated by CySEC, FCA, ASIC, and the FSCA.

Markets.com – Best Proprietary Platform for Islamic Accounts

An FCA-regulated market maker, Markets.com offers trading and investing on over 2,200 instruments on a broad range of platform choices, including MT4, MT5, and its award-winning platform, Marketsx.  Markets.com offers one live commission-free account that can be converted into an Islamic Account.  Markets.com does not apply a commission or spread mark up to its Islamic swap-free account, making it a good choice for Islamic traders.

Marketsx is an advanced multi-asset trading platform packed full of features for both Android and iOS.  Islamic account-holders can access a range of fundamental, technical and sentiment-based trading tools and expert analysis, in addition to in-depth charting and comparison tools.  It is also optimised for lightning-fast execution.  Lastly, Islamic account-holders should be aware that some instruments are not available for swap-free trading.    

Pros
  • Well regulated
  • Tight spreads
  • Wide range of assets
  • Fast and free withdrawals
Cons
  • High minimum deposit
AlertAccepts Australian Clients. Average spread EUR/USD 0.70 pips on trading account with lowest minimum deposit. Max leverage 30:1. Islamic account available. MT4, MT5, and Markets.com platforms supported. Markets.com is regulated by the FSCA, FCA, CySEC, ASIC, and the BVI FSC.

Islamic Forex Trading

There are three articles of the Islamic Mua’malat that are relevant to Forex trading:

  • Riba: Prohibition of payment and receipt of interest
  • Gharar: Prohibition on gambling
  • Shared Risk: Both profit and losses

The key element here is the elimination of Riba – or interest on loans or assets.

Riba is central to conventional Forex trading, but according to Islamic law, or Shari’ah law, Muslims are banned from earning interest on loans. Some scholars believe that the practice of removing Riba, as brokers do on their Islamic Forex accounts, legitimises Forex trading under Shariʻah.

Islam also emphasises that when conducting business transactions, elements of uncertainty, excessive speculation and gambling should also be avoided, so it could be argued that hedging trades with Forex is also legitimate under Shari’ah. It is also widely agreed that conventional Forex transactions – if used carefully – are a very effective means of protecting banks from exposure to international risk.

Shared Risk

Another concern about the Islamic nature of Forex trading is the element of shared risk. Luckily, with Forex trading, when you trade, you are investing in an asset – the currency purchased. If this asset increases in value, you will make a profit and if the asset loses value, you will make a loss. The result is a sharing of the benefits and losses of the currency exchange with your counterparty. From this point of view, Forex trading and Islam are compatible in terms of shared risk.

What is an Islamic Forex Account?

Across the Islamic world, many brokers offer Shari’ah compliant accounts to make sure that your trading is not haram – though this does mean that there are a few differences when compared to traditional Forex accounts.

Islamic Forex accounts have two underlying attributes:

Other than the above, Islamic Forex accounts usually have the same trading terms and conditions as a regular Forex account. However, some most Forex brokers change the commercial terms of trading with them and might limit the trader from trading cryptocurrencies. 

Some Forex brokers will widen their spreads on Islamic accounts to compensate for the missed revenue that would otherwise have been generated by collecting interest. Another practice, but is far rarer, is that some Forex brokers charge an up-front commission on trades instead of widening the spreads.

Forex Brokers with Islamic Swap-free Accounts

There are a variety of brokers that offer Islamic accounts tailored for Muslim traders. There are usually no limitations on this account type – this means you can trade Forex, commodities, CFDs contracts and every financial instrument that complies with the Islamic financial regulations.

An important note:  With most Forex brokers, you will need to open a real trading account which can then be converted into an Islamic account. Few brokers have a registration page specifically for Islamic accounts, and even fewer have Islamic demo accounts, but some brokers with clients from predominantly Muslim countries automatically create accounts as Islamic accounts.

If you are in doubt, make sure you discuss your concerns with your account manager or broker representative before you make a deposit.

Forex Rollovers and Swap Rates Explained

In the Forex market, any position held overnight generates a rollover which will be earned or paid out depending on the currency you are trading and the direction of the market. Rollover interest is a form of interest that can be credited or debited from your Forex trading account, and thus it is prohibited by Islamic financial regulations.  In the financial world, this rollover is also known as the swap rate.  So, Islamic Forex accounts are swap-free accounts where no overnight interest is credited or debited.

Islamic Financial Regulatory Bodies

The central financial regulatory bodies in the Islamic world are the following:

Forex brokers that are registered in Muslim majority countries often have to comply with many local regulations and are required to follow Shari’ah law, whereas Western Forex brokers have much more flexibility when it comes to the interest charged to their clients.  This is why only some of the brokers offer this account type.

Summary

An Islamic Forex account, or swap-free account, is an optional account type that is often selected after signing up with a broker.  They are intended for use by traders of the Islamic faith, which prohibits generating income from interest payments.  Most Forex brokers can accommodate followers of the Islamic faith by offering swap-free trading accounts that are compliant with Shari’ah law.

Forex Risk Disclaimer

Trading Forex and CFDs is not suitable for all investors as it carries a high degree of risk to your capital: 75-90% of retail investors lose money trading these products. 

Forex and CFD transactions involve high risk due to the following factors: Over-leveraging, unpredictable market volatility, slippage arising from a lack of liquidity, inadequate trading knowledge or experience, and a lack of regulatory protection for clients.

Traders should not deposit any money that is not disposable. Regardless of how much research you have done, or how confident you are in your trade, there is always a substantial risk of loss. (Learn more from the FCA or from ASIC)

Our Methodology

Our State of the Market Report and Broker Directory are the result of extensive research on over 100 Forex brokers. The explicit goal of these resources is to help traders find the best Forex brokers – and steer them away from the worst ones – with the benefit of accurate and up-to-date information.

With over 150 data points on each broker and over 3000 hours of research and review writing, we believe we have succeeded in our goal. 

In a world where trading conditions and customer support can vary based on where you live, our broker reviews focus on the local trader and give you information about these brokers from your perspective.

All research has been conducted by our in-house team of researchers and writers, gathering information from various company representatives, websites and by sifting through the fine print. Learn more about how we rank brokers.

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Trading Forex and CFDs is not suitable for all investors and comes with a high risk of losing money rapidly due to leverage. 75-90% of retail investors lose money trading these products. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

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