5 Best Islamic Accounts for Halal Forex Trading (Swap Free)

Forex Trading interests and attracts traders all around the world. However, some Muslim traders who follow the Sharia law face a unique challenge. Typically, forex trading comes with swap charges on positions held overnight, and this goes against Sharia law. 

The Islamic Forex accounts offered by brokers also referred to as swap-free accounts, resolve this conflict by removing the swap charges. These accounts enable Muslims to trade Forex in a permissible way (Halal). We at WR Trading have compiled a list of the top 5 Islamic forex accounts that will allow you to trade the forex market with peace of mind.

After our extensive research at WR Trading, we came up with these brokers and their Islamic account offerings. Sharia-compliant traders should highly consider them before opening a trading account:

#1 BlackBull Markets – Top Islamic Account Choice

BlackBull Markets offers the most sophisticated range of ECN Islamic accounts, catering to every sort of trader. 

The broker offers two swap-free ECN accounts: ECN Standard and ECN Prime. The ECN Standard account is suitable for new traders, but the ECN Prime account is more suited to experienced traders.

BlackBull Markets has options for whichever trading style you are most comfortable with, supporting both TradingView,  MT4, and MT5. Both ECN Standard and ECN Prime clients are serviced through Equinix NY4/LD5 servers.

BlackBull Markets takes great pride in offering one of the most transparent pricing structures. This means that you will clearly see how spreads and commissions apply in your trades, and this will help you make fully informed choices.

In our experience, BlackBull Markets is flexible for Islamic account traders. Their range of Shariah-compliant accounts provides excellent benefits that will suit your trading style and risk appetite. We rank Blackbulls swap free accounts in 1st-place.

Key Facts About Blackbull Markets Swap-free Accounts:

Feature	Blackbull Markets Swap Free Standard	Blackbull Markets Swap Free Prime
Minimum Initial Deposit	$0	$2,000
Spreads	From 0.8 pips	From 0.0 pips
Instruments	60+ currency pairs, commodities, indices, cryptocurrencies	60+ currency pairs, commodities, indices, cryptocurrencies
Maximum Leverage	Up to 500:1 (depending on instrument)	Up to 500:1 (depending on instrument)
Execution	Market Maker/ECN Hybrid	STP/ECN/NDD
Commission	No swap charges	No swap charges
Minimum Trade Size	0.01 lot	0.01 lot
Expert Advisors (EAs)	Supported	Supported
Mobile App	MT4 & MT5 Mobile Apps	MT4 & MT5 Mobile Apps

#2 FP Markets – Best Overall Islamic Forex Account

FP Markets ranks 2nd among brokers who offer the best Islamic ECN Trading service. Their swap-free Islamic account allows you to trade the Forex market without worrying about any swap charges. To open an MT4/MT5 trading account with them, send an email to onboardingsc@fpmarkets.com, stating your account number and the fact that you would like it converted. Then, wait for confirmation from the Onboarding team.

During your registration, the broker reserves the right to ask for additional identification documents. Your religion should be visible on these ID documents. You may also be asked to send proof of your faith in the form of a letter from your mosque.

FP Markets provides swap-free accounts on both its Raw and Standard account types. Instead of swap charges, an administration fee on managed positions is charged to the account holder and debited from the account’s balance. Tight spreads, access to ECN, and no swaps make the ideal financial ecosystem for both new and experienced Sharia-compliant traders. We rank FP Markets swap-free accounts in 2nd place.

Key Facts About FP Markets Swap-free Accounts:

Feature	Islamic Standard Account	Islamic Raw Account
Minimum Initial Deposit	AUD 100 or equivalent	AUD 100 or equivalent
Spreads	From 1.0 pips	Starting From 0.0 pips
Instruments	70+ Forex pairs, metals, indices, commodities	Over 70 Forex pairs, Instruments on metals, instruments on indices
Maximum Leverage	1:500	1:500
Execution	ECN	ECN-Pricing
Commission per lot	No	$3 per lot
Minimum Trade Size	0.01 Lots	0.01 Lots
EAs	Yes	Yes
Mobile App	Yes	Yes

#3 Vantage Markets: Best Scalper Islamic Account

The Raw Islamic ECN Account, offered by Vantage Markets, is ideal for scalpers and high-frequency traders. This ECN account does not bill swap charges for holding and moving positions, making it an ideal account for scalping with razor-thin spreads. 

Vantage Swap-Free Accounts are available to traders in South Africa, Kenya, Botswana, and Nigeria. As such, Vantage offers multiple funding options, including bank wire transfers and credit/debit card deposits. Vantage Markets has a minimum deposit requirement of $50, which is very affordable for most traders. Traders get more than 1,000 tradable instruments, including forex, equities, commodities, ETFs, and bonds.

Their swap-free accounts allow a minimum trade size of 0.01 lots, giving all traders room to participate in the market. Holding positions on these accounts overnight incurs an administration fee which is usually debited from the account holder’s balance.

At WR Trading, our verdict is that Vantage Markets’ Islamic Raw ECN account is robust enough for high-scalpers and high-frequency traders seeking a swap-free environment at ultra-competitive rates. So we rank it in 3rd place. The following are some of the characteristics that attract traders to this broker’s swap-free accounts.

Key Facts About Vantage Markets Swap-free Accounts:

Feature	Swap Free Standard Account	Swap Free Raw ECN Account
Minimum Initial Deposit	$50	$50
Spreads	Raw spreads starting from 0.0 pips	Ultra-low raw spreads starting from 0.0 pips
Instruments	Over 1,000+ CFDs including Forex, Shares, Indices, Commodities, and Cryptocurrencies	Over 1,000+ CFDs including Forex, Shares, Indices, Commodities, and Cryptocurrencies
Maximum Leverage	Up to 500:1 (depending on instrument)	Up to 500:1 (depending on instrument)
Execution	STP	ECN
Commission	No swap charges	Commission per traded side: Variable (starting from $3 AUD  per 100k traded)
Minimum Trade Size	0.01 Lot	0.01 Lot
Expert Advisors (EAs)	Supported	Supported
Mobile App	Yes (My Vantage App)	Yes (My Vantage App)

#4 XM – Best Islamic Account for Beginners

XM makes forex trading easily accessible to Muslim beginner traders, thanks to its user-friendly platform and low minimum deposit requirement on swap-free accounts. 

The account can be opened in three easy steps and the swap-free option can be chosen as part of the trading account registration. Simply Open a trading account with XM. Login to the member’s area and verify your account. Next, request an Islamic Account.

As soon as XM’s designated department receives your request, your trading account will receive swap-free status, and you will be notified by email accordingly. XM reserves the right to revoke the swap-free status granted to any real trading account in the event of any form of abuse.

The XM forex Islamic accounts differ greatly from those generally offered by other forex brokers. Unlike most forex companies that substitute additional fees by widening the spread on Islamic accounts, XM imposes no additional charges. XM is firmly against practices that oppose fair and ethical trading conditions.

We at WR Trading found XM’s Islamic account to be a welcoming entry point for beginner Sharia-compliant traders, and that is why we rank it in 4th-place. Here’s what makes it appropriate for those starting their forex journey:

Key Facts About XM Markets Swap-free Accounts:

Feature	XM Ultra Low Micro Islamic	XM Ultra Low Standard Islamic
Minimum Initial Deposit	$50 (or equivalent)	$50 (or equivalent)
Spreads	From 0.6 pips	From 0.6 pips
Instruments	Over 50 currency pairs, precious metals, energies, equity indices, and individual stocks	Over 50 currency pairs, precious metals, energies, equity indices, and individual stocks
Maximum Leverage	Up to 1000:1 (depending on instrument)	Up to 1000:1 (depending on instrument)
Execution	Instant Execution	Instant Execution
Commission	No swap charges	No swap charges
Minimum Trade Size	0.01 micro lot	0.1 standard lot
Expert Advisors (EAs)	Supported	Supported
Mobile App	MT4 & MT5 Mobile Apps	MT4 & MT5 Mobile Apps

#5 Pepperstone – Best Islamic Account for Low Latency Trading

Pepperstone has established itself as a leader in ECN forex trading, and its Swap-free account extends this excellence to Sharia-compliant traders. The Pepperstone Razor Islamic Account impressed us at WR Trading with its focus on low execution latency. This, combined with the ECN access and commission structure, makes it a compelling option for Sharia-compliant traders who prioritize fast execution speeds.

When traders opt for the Pepperstone Swap free Razor Account, they can get rates directly from the interbank markets, which guarantees fast execution speeds and potentially tighter spreads, benefiting traders who are employing low-latency strategies.

When a trade on this account has been held for five days, an admin charge is deducted from the account’s balance. The Razor account runs on a commission-based structure. This can be cost-effective for active traders who benefit from the tight spreads offered on this ECN account. 

Key Facts About Pepperstone’s Swap-free Accounts:

Feature	Pepperstone Standard Swap-Free	Pepperstone Razor Swap-Free
Minimum Initial Deposit	$0	$200 USD (or equivalent)
Spreads	From 1.0 pip	From 0.0 pips (with Razor account rebate)
Instruments	Over 1,000+ CFDs including Forex, Shares (CFD only), Indices, Commodities	Over 1,000+ CFDs including Forex, Shares (CFD only), Indices, Commodities
Maximum Leverage	Up to 500:1 (depending on instrument)	Up to 500:1 (depending on instrument)
Execution	ECN	ECN
Commission	No swap charges	No swap charges, but the commission per traded side applies
Minimum Trade Size	0.01 lot	0.01 lot
Expert Advisors (EAs)	Supported	Supported
Mobile App	MT4 & MT5 Mobile Apps	MT4 & MT5 Mobile Apps

What is an Islamic Trading Account (Swap-Free)?

An Islamic Forex account, also known as a swap-free account, is a halal trading account that is offered to clients who respect the Quran and wish to trade in the market following Islamic finance principles.

Traditional forex trading involves borrowing and lending currencies to open and maintain positions. Forex swap charges, also known as rollover interest, result from these transactions on positions held overnight. For those adhering to Sharia law, these interest-based transactions are considered haram (forbidden).

Swap-free accounts offer a solution for Muslim traders. Here’s how they work:

Elimination of Swap Charges

Islamic accounts eliminate swap charges entirely. This ensures your trades comply with the prohibition of riba (usury) in Sharia law.

Alternative Financing Methods

Instead of swap charges, some Islamic forex brokers employ alternative financing methods. These methods can include:

• Commissions: Brokers might charge a commission fee on each trade. This fee replaces swap charges and compensates the broker for the service offered in holding your trades overnight.
• Profit-sharing: A less common approach is through profit-sharing agreements. In this model, the broker shares a portion of your profits generated from successful trades.

Is Forex Trading Halal and Allowed with The Sharia Law?

The debate on whether forex trading is permissible under the Sharia Law did not start and certainly won’t end today, but there is a consensus that the concept of currency exchange is permissible.

Here’s what makes forex trading potentially halal:

• Underlying Asset Ownership: In forex trading, you essentially own the underlying currency pair. This differs from loan-based transactions where interest is charged.
• Spot Transactions: Forex trades are typically settled immediately (spot transactions) or within a short timeframe, eliminating the issue of long-term interest accrual.

However, the presence of swap charges associated with traditional forex accounts introduces the element of riba, making them incompatible with Sharia law. Islamic forex accounts address this concern by eliminating swap charges, allowing Sharia-compliant participation in the forex market.

Why Are Swap Fees Haram?

Swap fees, also known as rollover interest, are considered haram (forbidden) under Sharia law for several reasons:

• Exploitation: Sharia law does not permit practices that exploit financial difficulty. The charging of interest is considered a means of exploiting the desperate situation of the borrower for personal interest.
• Unfair Gain: The notion of receiving unearned income for absolutely no labor other than lending is considered an injustice according to the tenets of the Sharia. In this regard, Islamic finance has been established on the law of mutual risk and just exchange of value.
• Uncertainty: The predetermined nature of interest payments contradicts the Islamic principle of shared risk and reward. Islamic finance encourages profit-sharing arrangements where both parties share the potential benefits and burdens of a transaction.

By eliminating swap charges, Islamic forex accounts ensure your trading activities align with these core principles of Sharia law.

How Does an Islamic Trading Account Work?

Knowing how Islamic Forex accounts work will help you make the right trading decisions. Here’s a breakdown of how Swap-Free accounts operate:

• Order Placement: You place your forex trades in the same way you would in a regular forex account. You dial the currency pair, specify the volume of the trade and direction—buy or sell—and place your order.
• Order Execution: After your broker has executed the order, the currency pair you have chosen will appear as being traded in your trading platform.
• Overnight Financing: Here’s where Islamic accounts differ. Typically, if you hold a position overnight, you would incur swap charges. However, these charges are waived with an Islamic account.

Opening an Islamic swap-free trading account is easy. The typical procedure is to select a broker offering Islamic accounts and open a regular trading account with them. After opening an account, contact their customer support and request that your standard account be changed to an Islamic one. Some brokers may ask for proof of your faith, like a letter from the mosque assuming your religion is not indicated in your ID documents.

In many cases, non-Islamic traders are allowed to have swap-free accounts, although they are mainly tailored to serve Islamic financial principles that forbid receiving and paying interest on overnight positions. In any case, one needs to check with the broker’s policy on eligibility for a swap-free account and any other costs attached to it.

We, at WR Trading, recommend that clients read through the broker’s terms and conditions regarding Islamic accounts before opening the account. This ensures you’re familiar with their specific swap-free practices and any associated commission fees.

Note that even though swap charges are eliminated, Islamic accounts might still involve other fees, such as spreads (the difference between the buy and sell price of a currency pair) and inactivity fees. Be sure to research all potential costs associated with your chosen Islamic forex account.

How We Tested the Best Islamic Swap-Free Accounts

At WR Trading, we know that what the brokers claim about their Islamic account is simply not enough basis for you to trust them. So, to provide you with the most reliable information, we developed an efficient testing process that goes beyond those generic marketing materials. Here’s a glimpse into our process:

• Verification of Swap-Free Status: We start with a meticulous review of the broker’s Islamic account terms and conditions, to ensure that the broker affirms it is truly swap-free.
• Trading Platform Functionality: We test the functionality of the swap-free feature within the broker’s trading platform. This involves placing sample trades and verifying that no swap charges are applied when holding positions overnight.
• Commission Structure Analysis: For Islamic accounts with commission-based structures, we analyze the commission fees. This includes considering factors like transparency (clear communication of commission rates) and competitiveness (comparing fees to other brokers).
• Execution Speed Assessment: While swap-free functionality is our primary focus, we also evaluate the execution speed of Islamic accounts. Faster execution speeds can potentially improve your trading performance, and we consider this an important factor for Sharia-compliant traders as well.
• Customer Support: We evaluate how good and reachable customer support is available to clients who open an Islamic account. At that, you will be assured of an educated customer support team to attend to all your questions or issues that you may have in the course of your swap-free trading experience.

Conclusion

The world of Forex trading is now explorable for the Sharia-compliant Muslim trader. With the right Islamic account and broker selection, you can begin to trade Forex with a clear conscience about whether your actions violate your religion.

Remember to consider some main factors, like the reputation of your broker with observing Sharia-compliant practices, the reliability and accessibility of their customer care, and whether the account features offered to suit your trading style.

By carefully evaluating these factors and leveraging the insights provided in this guide, you can confidently select an Islamic forex account that empowers you to achieve your trading goals while upholding your faith.

Frequently Asked Questions on Islamic Accounts for Halal Forex Trading