Are you confused about where to start setting up a forex trading firm in Dubai? That’s exactly what we’ll help you with today! Business setup in Dubai, specifically for a forex brokerage, is an exciting business opportunity! However, there are lots of important decisions and steps you need to take, including knowing how to attract new customers.
How to Open Your Own Forex Company in the UAE?
If you will be starting from scratch, the business setup process for your forex trading company will require some solid startup capital. You will also have to put in lots of time and effort. The business has to be incorporated with the Department of Economic Development in the UAE, Dubai Multi Commodities Center (DMCC), or Dubai International Financial Center (DIFC), and comply with the legal requirements. Aside from that, you have to negotiate with the UAE Central Bank and build an attractive website. The benefit of opting to manage your own company is you keep full control and the majority of the profits from your business.
We’ve outlined the most important steps below for opening a forex business in Dubai. Check them out!
Define Your Target Market
It’s a great idea for you to define the target region first. It may be Dubai, Abu Dhabi, or any of the other UAE emirates. Knowing where your clients come from is going to help you a lot in selecting the best jurisdiction for registering and incorporating your brokerage. With this particular kind of business, the licensing requirements can vary greatly from one emirate to another. It’s often a lot easier if you start the forex brokerage where you’re already familiar with the place. Of course, you will need to speak to business setup experts. They will help you compare the legal requirements for several jurisdictions you’re considering prior to making a final decision.
Read also: Business Ideas for You to Start in Dubai
Create a business plan for the forex brokerage
Although a rather detailed business plan isn’t really necessary, setting up a brand-new financial business will prove to be a long and tedious journey. This is especially the case if you don’t have business setup consultants in UAE backing you. Apart from expert guidance, create a business plan for the forex brokerage to streamline the entire process. An excellent business plan is one that consists of target market description, description of buyer personas, projects capital plus expenses, competitor benchmarking and research, social and marketing strategy, and the startup capital.
Gather the initial capital
The minimum share capital for registering with DMCC is currently set at Dhs 50,000 or USD$ 13,625. Take note: the capital requirements are different for every jurisdiction. Check with business setup experts in Dubai/UAE for the minimum share capital requirement. Regardless of the requirements, the cost of forex brokerage business setup in Dubai or any of the other emirates is quite high. You’ll have to gather enough money for covering the operating expenses for the first six months to one year of business operations.
Select the correct partners
First, forex trading companies need reliable service providers for payment processing. There’s no way for your business to compete in the market if you don’t have a stable system in place to process payments. Consider negotiating with at least two systems. This way, you have reserve options in the event of a failure from your primary payment processor. It’s equally important to have several different withdrawal and deposit options that are convenient not just to you, but also for your potential customers.
If you’re planning on offering leverage (after all, who doesn’t, right?), you will also require some negotiations with banks for a business line of credit. UAE Central Bank has complicated approval and verification procedures. Plan ahead, seek expert help and allow enough resources for the process.
Set up business pages online
This includes creating a fast website, making a decision on the trading platforms, and the additional services you want to integrate. Creating a high-quality website can be a slow process. However, it makes absolute sense for forex trading companies, so take care of it early in the process of business setup in Dubai or anywhere in UAE.
Read also: Tips for a Successful Business Setup
Set up your office space
As a minimum, forex trading brokerages need financial personnel, marketing or sales teams, customer support team, compliance officers, and IT personnel. At the very beginning, where there’s somewhat of a low trading volume, there are roles that may be executed and handled by the managing partners. One employee can also take on several roles, provided that he/she has the qualifications. What is most likely to happen, however, is you will need a sizable amount of space for the physical office location. If you replace the traditional office with a virtual one, there are flexi-desk options available with the different financial centers across the UAE.
You can inquire regarding the flexi-desk options for satisfying your business’ legal requirements when processing your trade licenses with the appropriate authorities.
To know more about business setup in Dubai, UAE, call us here in FAR Consulting Middle East today!