Last update: 7 December 2020
6 min read

BAPPEBTI Regulated Forex Brokers

If you want a top Indonesia broker, BAPPEBTI regulation is a great start. Our experts have explored the best BAPPEBTI regulated brokers – and alternative options – which you can join today for an unbeatable experience.

In Indonesia, regulation of Forex brokers falls in the lap of BAPPEBTI. The initials stand for Badan Pengawas Perdagangan Berjangka Komoditi which roughly translates to the Commodities and Futures Trading Regulatory Agency. The agency was launched in 2005 and is the only agency in Indonesia responsible for regulating various financial entities, including BAPPEBTI regulated brokers. It is supervised by the Ministry of Finance and managed by a board of administrators made up of industry experts who have been selected by the Indonesian government.

If you’re looking for a list of the best BAPPEBTI regulated brokers, it’s worth noting that there are currently very few in operation. Instead, why not check out some of the top rated international brokers?

Best and most trusted forex brokers in April 2024

Do brokers in Indonesia protect traders?

bappebti regulator logoForex trading in Indonesia is becoming increasingly popular. It is a heavily populated country with a largely Islamic population. As demand is increasing, so too are the number of brokers. A wide variety of tradable instruments are now being made available by local and international firms to improve the standard of the best BAPPEBTI regulated brokers.

Traditionally, BAPPEBTI regulated brokers have tended to focus on futures and commodity trading, with only a small number offering forex trading. This resulted in an increasing number of international forex brokers targeting the Indonesian market and gaining quite a foothold in the country. This, of course, led to an ever-increasing number of brokers offering their services to Indonesian investors which unfortunately included some scam websites. A large number of Indonesian investors lost huge sums of money.

In 2013, things changed for the better for traders in Indonesia, when the Government started to take regulation more seriously. Significantly, a number of brokers were banned – along with their associated platforms. This means added protection for all traders who are active in Indonesia.

Why is it hard to find the best BAPPEBTI regulated brokers?

There were a number of international brokers that decided to take advantage of the growing market of young potential traders. It wasn’t the easiest of markets to break into, as the business infrastructure is not as economically viable or open as many other emerging countries. There is also high taxation in the country and piles of red tape for anyone wishing to set up a business.

A much easier way for these international brokers to offer services was through an online platform. This angle of attack was helped by the lack of a regulatory framework or even a basic set of guidelines. But a significant change occurred in 2013 when the Government decided to initiate an overhaul of the industry and began looking much more closely at the rising number of forex scams, aiming to end them completely. It decided on this course of action following the loss of millions of dollars by Indonesian citizens.

The general public was given all the details of existing brokers scams and complaints which had been raised against broker companies. It did this by creating the TRUST+ website to inform Indonesian citizens of the risks and fraudulent practices happening in the world of trading. What happened next was the best BAPPEBTI regulated brokers offering tailor-made services for Indonesian citizens.

While these home-grown licensed brokers were able to achieve licensed status, the level of service and sophistication didn’t match that of major international brokers. This upset a number of industry experts and the public in general.

Because of the lack of high-quality choices from local brokers, the government decided overseas brokers could operate in Indonesia. A requirement was for the brokerage firm to follow the relevant terms and conditions of local authorities. The ban on international brokers has since been removed and citizens are now free to choose whatever broker they want.

BAPPEBTI’s growing responsibility to traders in Indonesia

It is still not a very popular idea for many of the mainstream brokers to set up operations in Indonesia, and there are a number of reasons for brokers choosing to stay away from the country.

There are still no solid guidelines in place for financial companies to follow which means businesses aren’t able to benefit from a stable business environment. Many consider the business costs in Indonesia to be very high, and it would be difficult for any new business to recover invested capital through a retail trading business.

Business tax is also very high in Indonesia, which is bound to put companies off the idea. There are a small number of brokers – some of the best BAPPEBTI regulated companies around – which have been able to gain a favorable position. But this doesn’t prevent a number of unregulated brokers also setting up offices in Indonesia, and any citizens would be advised against making this choice.

Traders can only benefit from choosing regulated brokers as it guarantees the safety of trading funds. It also offers the best possible environment in which to become a successful trader. As we’ve already mentioned, regulated trading is still in its infancy in Indonesia. Check back regularly as we’ll keep you updated on the latest situation.

How BAPPEBTI brokers are able to operate

The trading conditions imposed by BAPPEBTI are in compliance with Sharia law. The fact that Indonesia is a largely Muslim country means brokers in Indonesia have to offer specially designed Sharia-compliant accounts. While trading isn’t considered wrong on religious grounds, a number of special trading conditions have to be followed.

There is, unfortunately, no assistance provided to traders who fall victim to financial scams because the regulatory framework is still very much in its early days. This should improve over time. It isn’t going to be long before the government authority increases the regulatory scope of BAPPEBTI and add the licensing and regulating of brokers to its list of responsibilities. It has already shown it is more than capable of regulating and licensing financial operators dealing in commodities and futures.

Finding BAPPEBTI regulated brokers

There aren’t many sites regulated by BAPPEBTI, but there are some good ones out there. If you’re unsure whether a broker is or isn’t regulated by BAPPEBTI, examine the footer of their official website, which should hold license information. Failing that, you can always check the website of BAPPEBTI itself, where you’ll find a full list and information on regulated brokers.

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