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Traders Fund Account With Credit Cards

What raises an even graver concern is the case where a trader loses his or her entire deposit, more often then not people have used their full credit limits due to poor money management, inappropriate trading behaviors or lack of the right trader psychology or mindset. They are charged fees for the account being at its limit, and they are unable to make their monthly credit card payments on time. When the trader misses a payment, they are charged a multitude of fees and continuously increasing interest rates will be charged by their credit card issuer, while their credit score will worsen. The result of just using a credit card to deposit funds into your trading account could lead you to be so heavily indebted it could take you years, possibly even a decade to recover.

The Ban On Using Credit Cards

The issue of traders using credit cards to fund their account have arisen so much it has even caught the eye of financial industry watchdog National Futures Association or NFA. They plan to implement a ban on credit card funding for U.S. Forex accounts. This proposition was granted the green light by the CFTC (Commodity Futures Trading Commission) in 2014, and the reforms officially took effect on January 31, 2015. The ban on credit card funding for U.S. high-risk derivative transactions would apply to both new and existing customers, prohibiting them from funding their futures or Forex accounts using credit cards; this includes PayPal, and Skrill among many others. According to the NFA, this move would limit potentially fraudulent activity and would encourage traders to stick to using funds they already have.

Of course this ban is only sanctioned by U.S. licensed and federally regulated Forex Brokers, but what about unregulated offshore brokers you may ask? They still may provide Credit Card deposits as an option for U.S. traders but if you are a U.S. citizen you should not be tempted. Not only are the risk of losing all of your investment increased, but your personal information, and identity are also at risk if you choose the wrong unlicensed offshore Forex brokerage.

D'Vaughn Bell
D'Vaughn Bell
CEO & Founder of Global Currenciez. By being a Personal Trainer, Athlete, Entrepreneur, Humanitarian, Author and U.S. Marine, I was able to master determination, discipline and astute attention to detail. Everything I've been through, all the struggles, each obstacle became my resume for success. D'Vaughn Bell

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