Shariah, the Islamic law, prohibits interest payment. However, the rollover interest is an integral part of forex trading. How can a Muslim forex trader from Saudi Arabia or the United Arab Emirates trade currencies without violating the religious law? The answer is to find a forex broker willing to offer an Islamic forex account with no overnight interest. Such swap-free accounts are usually offered only to Muslims in order to prevent abuse. To substitute for the revenue from a missing swap, Islamic forex brokers also charge a flat fee for this service. The only exceptions is InstaForex, which does not charge any additional fee for its Sharia account.

A review of five brokers offering an Islamic forex account follows. This list of Islamic forex brokers was created using our interactive comparison of forex brokers. I included only the online forex brokers that offer Islamic swap-free accounts and are regulated by trustworthy authorities. The five cheapest Muslim friendly brokers are ordered starting with the lowest spread (transaction costs).

#1. InstaForex

InstaForex is one of the few ECN forex brokers who offer Islamic forex accounts. What do the letters “ECN”, so coveted by forex traders, mean in practice? First, InstaForex has no dealing desk that would trade against their clients or requote prices. Second, InstaForex’s variable spread can sometimes decrease to zero pips. Alternatively, you can also ask them for a fixed spread, which is a bit higher (2 pips on EUR/USD). But, why would you? Muslim forex traders can trade 121 currency pairs, gold, oil, stocks, indexes, and futures. Depending on the account, you can choose any leverage from 1:1 up to 1000:1, which is the highest leverage offered by any forex broker. InstaForex uses the popular and highly sophisticated MetaTrader 4 trading platform. It supports hedging, trailing stops, and automated trading. Quality is guaranteed by awards that this forex broker regularly gets. In last two years, InstaForex was named the best forex broker in Asia and I personally know several traders from Malaysia, who trade with this broker. What is very important, InstaForex is also the only forex broker that does not charge any additional fee for an Islamic forex account. The customer support at InstaForex also speaks Arabic. You can get more information about this Islamic forex broker from our detailed InstaForex review.

#2. FXOpen

FXOpen welcomes traders from all Muslim countries. The fixed spread is among the lowest in the industry (2-3 pips on majors). In addition to 32 currency pairs, a Muslim forex trader can also trade precious metals (gold). The available leverage is among the highest (500:1), but you can also choose a leverage 1:1 if you wish. Since FXOpen’s minimum deposit is only $1 and it the minimal contract size only $100, it is possible to test FXOpen’s live trading platform practically without any risk. The forex trading platform itself is the popular MetaTrader 4 (MT4), which features hedging, trailing stops, and free automated trading (EA). FXOpen also offers mobile trading. Their customer support speaks Malaysian. For more information read the FXOpen review.

#3. eToro

eToro distinguished itself from the rest of the crowd by an easy-to-use, visually-based trading platform. Obviously, their platform appeals more to beginners than to advanced traders. For example, although it supports hedging, eToro does not provide any algorithmic trading. On the other hand, both beginners and advanced traders would be definitely interested in eToro’s fixed spread of 2-3 pips on all majors. It is not so frequent to see a broker offering the fixed spread of 2 pips on USD/CHF. Another attractive feature of this Islamic forex broker is the leverage of 400:1. eToro also provides support in the Arabic language. For more details, see the eToro review.

#4. Finexo

Finexo is a forex broker from Cyprus, under the oversight of strict European authorities. The leverage is 200:1 and the minimum deposit $25. Features of the trading platform include trailing stops and mobile trading. But the spread is higher (2-5 pips for major currencies) than in the previous cases. What is unique, Finexo can communicate with Muslim forex traders not only in Arabic, but also in Turkish. You can find more details in the Finexo review.

#5. Easy Forex

Easy Forex offers the spread of 3-6 pips on majors, which I consider a bit too high. However, they offer a great variety of 182 different currency pairs and precious metals. Another advantage over their competitors is that you can hold an Islamic forex account in one of twelve currencies, not just USD or Euro. The customer support speaks Arabic. Easy Forex offers the 200:1 leverage, a minimum deposit of $100, hedging, mobile trading, but, again, there is no automated trading. If you want to know more about this Islamic forex broker, please read the Easy Forex review.

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