Licence types
Forex licence types: which permissions does your model need?
Regulators name their licences differently, but they all ask the same question: will you deal against clients, or only pass orders on? The answer drives capital, substance and the licence category.
Updated
Forex licences differ mainly by whether you deal on your own account (market maker) or only pass orders on (STP/agency). Regulators call them securities dealer, broker-dealer, investment dealer, investment firm or financial services provider licences; permissions drive capital, substance and governance.
The main licence categories
| Category | What it allows | Typical names |
|---|---|---|
| Market maker (principal) | Dealing on own account, taking the other side of client trades | Full service dealer, dealer in securities as principal, Category 3A (DFSA) |
| STP / agency broker | Receiving and passing on client orders to liquidity providers | Broker, dealer as agent, Category 4 (DFSA), STP licence |
| Securities dealer / broker-dealer | Dealing in securities including derivatives such as CFDs | Securities Dealer (Seychelles), Broker-Dealer (Bahamas), Investment Dealer (Mauritius) |
| Investment firm (EU) | MiFID II investment services with EEA passporting | Cyprus Investment Firm (CIF) |
| Financial services provider | Advice and intermediary services; OTC derivatives need a separate provider licence | FSP Category I (South Africa), ODP licence |
| Offshore brokerage licence | Brokerage activities under a light offshore regime | International Brokerage licence (Mwali, Anjouan) |
Simplified overview. The exact category depends on your model, products and the regulator.
What changes with the licence type
Capital
Market makers face the highest minimum capital; agency brokers the lowest.
People
Dealing on own account usually requires a risk manager and stronger governance.
Client protection
Segregation of client funds, reporting and audit become stricter as permissions widen.
Licence types: questions
Do I need a market maker licence?
Only if you will take the other side of client trades (B-book). A pure STP/A-book model can often use a narrower agency licence.
Is a securities dealer licence enough for CFDs?
In several offshore jurisdictions, yes, because CFDs are treated as derivatives within the dealer licence. Some regulators, such as the Bahamas SCB, require a specific CFD approval.
Can one licence cover crypto CFDs?
Sometimes. Many regulators treat crypto CFDs as derivatives; spot crypto usually needs a separate virtual-asset registration.
Not sure which licence is right for you?
Tell us your business model and target markets. We will shortlist jurisdictions and send a fixed, itemised proposal.