FX Pesa marks a special milestone as it steps up financial literacy campaign

Online foreign exchange broker FX Pesa is ramping up the promotion of financial literacy and education among users, including traders and young learners, amid increasing trade volume

FX pesa is the trading name of EGM Securities, licensed by the Capital Markets Authority (CMA) as a non- dealing online FX (foreign exchange) broker.

Upon its entry into the local market, it became the first licensed broker to offer Forex and CFD products for the retail market in East Africa.

Today, the trading platform which is part of Equiti Group, is ranked the sector’s market leader by far despite more retail traders flocking the space.

The firm’s representatives say that Kenya compared to its regional peers is now among the top leading markets in terms of user activity in their platform over the past 5 years when it started its local operations in 2018. It will be 6 years in 2024.

How to trade the FX Pesa – way

“We offer solutions around global markets. We open up investors into global markets where you can trade commodities, indices, single stocks – American shares, you can also buy commodities like oil, natural gas and of cause precious metals like gold,” offers the Chief executive officer – CEO of EGM Securities Samwel Kiraka in a recent interview with the Financial Fortune Digital.

And with commercial banks continuing to offer stingy rates of return on deposits, potential investors, according to Mr. Kiraka, are now looking for new opportunities to multiply their own funds and FX Pesa offers just that.

Indeed, since the global financial crisis between mid-2007 and early 2009, a key tactic in the world’s recovery to that period of extreme stress in global financial markets and banking systems, has seen commercial banks consistently increase their capital reserves.

This in return provided banks with increased comfort in their liquidity positions and provided incentives to increase their lending rather than sitting on an excessive amount of cash at the negative short-term interest rates.

And while on paper it looks like a noble goal, the unfortunate consequence is that it has significantly increased the length of time savers are locked out of their deposits – an increase which is scarcely compensated for by a trivial rise in interest rates.

But not everyone wants to invest their savings for two years with no right to revoke and no more contributions than three or four percent per cent per year. These savers, according to Kiraka, are therefore seeking more attractive investment alternatives.

For investors who do not possess large resources like mutual funds, but are looking for a significant return on their capital, EGM Securities’ boss says, the foreign exchange market is a ‘natural home.’

“Everyone has a risk appetite and it varies, some have higher risks than others and it also depends on your trading journey. It is not a one-jacket fits all. At EGM Securities, we have 24/6 customer support where all inquiries are professionally held,” says Kiraka, in response to what times he considers to be the best to trade the Forex Markets.

Forex is the fastest growing and most liquid market in the world, according to readily available data online.

Key findings from the 38th Survey of North American Foreign Exchange Volume include, for instance, shows that an average daily volume in total over-the-counter (OTC) foreign exchange instruments (including spot, outright forward, foreign exchange swap, and option transactions) was $918.4 billion in April 2023.

High volatility of the markets is seen as one of the key ingredients drawing masses to the foreign market.

This volatility is mainly the result of the turmoil caused by a cocktail of global happenings like the recent Covid-19 pandemic and all the financial restrictions that surrounded it.

The war in Ukraine and the bickering between Palestine and Israel, global inflation as well as the ongoing US primaries have further increased volatility, which allows savvy traders to make profits on swing movements, whether negative or positive.

Financial literacy program revels training 1 million traders  

The world of Forex trading has become increasingly mainstream even in markets previously regarded ‘quiet’, and it continues to invite smaller businesses and individuals to trade alongside industry leaders.

And unlike in the past, Forex trading is now accessible and often profitable for investors with limited budgets.

Despite the decreased financial barriers to entry, the issue of knowledge and experience persists in the Forex trading market.

It is against this backdrop that brokers like FX Pesa are moving a notch higher as they seek to leverage on such promising opportunities by adopting financial literacy and education programs alongside their offerings.

Through its financial literacy program, the company seeks to not only school potential traders on stocks but also to promote a culture of savings and smart investments.

Launched in 2021, Kiraka says FXPesa Academy “has been on a mission to resolve any gaps in East Africa’s financial education.”

It is a financial education academy dedicated to the ever-growing need for Kenyans to understand the breadth of financial products out there and how they can take control over their financial futures with a little consciousness raising.

When we set up the business in 2018 and started to engage with the clients, and potential clients, we did realise that there was a need for financial literacy, we felt there was a gap that we needed to fill by enlightening more of our potential investors around global markets and not just global markets but generally about earning, savings and investing.

Adding that, “Then we took it upon ourselves in 2021 to aggressively educate them on financial understanding. The initial target was to reach at least 1million potential investors within three years.”

It is an accomplishment the company attained last year – a milestone he says, “is a testament to FXPesa’s unwavering dedication to empowering communities with the tools they need to make smarter financial moves.”

Reaching over one million individuals is a testament to the dedication of our team and the thirst for financial knowledge within our communities. This milestone is not the end, but a stepping stone towards a financially empowered society – Samwel KIRAKA, CEO EGM Securities.

It is a schoolwide resource dedicated to empowering students (in colleges and universities) to make their own financial decisions and have fun along the way.

The program is also open to traders and investors, business individuals across the 47 Counties. Similar engagements are also ongoing across the regional countries like Uganda and other markets.

Forex trading is basically the process of speculating on currency prices to potentially make a profit. Currencies are traded in pairs, so by exchanging one currency for another, a trader is speculating on whether one currency will rise or fall in value against the other.

The dollar remains the number one currency in the global financial system by several measures. The US dollar is the market’s dominant currency, and its dominance is particularly stark in FX markets, where it is on one side of 90% of all transactions and this has been the case since World War Two.