A combination of weak oversight structure and gaps in coordination of laws that should govern online trading in the country, is exposing retail traders to rogue and unregulated platforms, industry players have raised concerns.
This they say has been particularly around education, marketing and self-styled “academies”, that has allowed scams and misinformation to flourish.
Speaking ahead of the Africa Forex Trading Expo set for March 10–11 in Nairobi, Director of Azelia Expo Limited Zack Kiratu and Empire FX chief executive Peter Onyango, said fragmentation within the ecosystem has left loopholes that unscrupulous actors are exploiting.
“Kenya was the first African country to regulate online forex trading through the Capital Markets Authority (CMA) in 2017, and that was a major step forward. But regulation alone is not enough if the wider ecosystem remains fragmented,” Kiratu said.
“We still have unregulated brokers, unlinked educators and aggressive online marketing that blurs the line between legitimate trading and outright scams.”
He said the problem has been worsened by the lack of a standard framework governing forex education and training, leaving many first-time traders vulnerable.
According to industry estimates cited at the forum, between 70 and 80 per cent of retail traders lose money, largely due to poor financial literacy, lack of discipline and trading with unregulated platforms.
Onyango echoed the concerns, saying the biggest risk to Kenyan traders is not the market itself, but weak governance around access and education.
“Forex is not gambling, but when people are pushed onto complex platforms they don’t understand, with unrealistic promises of quick returns, that creates vulnerability,” Onyango said. “Without clear oversight, scammers step in and define the narrative. That is what has happened in Kenya and across Africa.”
Kenya’s forex market is among the most active in Africa. Industry data shows the country has more than 100,000 active retail forex traders, controlling an estimated $200 million (Sh26 billion) in trading value, a figure expected to grow by about 30 per cent year-on-year as digital adoption deepens.
Globally, the forex market trades about $9.6 trillion daily, having expanded by 28 per cent since 2022. Africa’s participation remains relatively small but is growing rapidly, driven by a young population, widespread smartphone use and mobile-money infrastructure.
Kiratu said Kenya’s demographic profile makes the stakes particularly high. “Over 75 per cent of our population is under 35, and about 800,000 young people enter the job market every year, yet the formal sector absorbs less than half. Many are turning to digital trading as an alternative income path,” he said.
However, both speakers warned that without stronger coordination between regulators, licensed brokers, educators and fintech platforms, growth could come at a high cost to consumers.
“At the brokerage level, licensed players already follow strict CMA rules on leverage, segregation of client funds and transparency,” Onyango said. “But outside that, there is still too much grey area. Anyone can open an ‘academy’, run ads promising double returns in a weekend, and there is little to stop them.
by JACKTONE LAWI
