Luke Ombara, the regulatory policy and strategy director at CMA. [Photo/businessdaily]Capital Markets Authority, (CMA) requires Kenya’s online currency traders to obtain a license to continue in the business following the recent enactment of tough regulations governing the market.CMA estimates that about 50,000 people, including brokers, dealers and money managers, are in the business and are mainly using offshore platforms that are not overseen by Kenyan regulators to offer the service.Luke Ombara, the regulatory policy and strategy director at CMA, said the new regulations now require the traders to register with the CMA as part of efforts to exert a measure of regulatory control over online forex business.The forex dealers must raise Sh50 million in the minimum capital, a requirement aimed at protecting consumers for the dealers to be registered.The regulations say, “An applicant seeking a licence as an online forex broker shall be a company limited by shares, have a minimum capital of Sh50 million, make an undertaking to maintain the minimum capital at all times plus five percent of liabilities owed to forex customers in excess of Sh50 million and ensure that Sh40 million or 80 percent of its capital, whichever is higher, is in the form of cash and cash equivalents in financial instruments at all times”.Foreign dealers wishing to trade in Kenya will also be required to maintain an equivalent of Sh40 million of their capital reserves in financial instruments in Kenya.

Do you have a lead on a newsworthy story? Share news tips with us here at Hivisasa!