Binary Options Trading in Philippines
Philippines has a growing binary options online trading population, keeping up with the current trends in other parts of Asia. However, the market is not as sanitized as it should be, with local agents of brokers pushing adverts of one platform or another. With such a mix of genuine and scam brokers competing for the local market, it is not surprising that there have been a few scams along the way. But this has not dampened appetite for digital options trading.
Binary option trading in Philippines is affected by three major factors:
- Availability of the product in the country.
- The attitude of the regulatory agencies towards binary options online.
- Ability to source foreign exchange for binary options online trading.
In dealing with the first factor, it is safe to say that although there are no binary options online brokers with a physical presence in Philippines, binary options online are available for trading. Most Filipino binary options online traders work with binary options online brokers located in Europe and other minor jurisdictions. Many of these brokers work with local affiliates and introducing agents to market and sell trading of binary options online to the local populace.
Generally speaking, the financial markets in Philippines are regulated by the Securities and Exchange Commission (SEC), which is an agency of the national government in Philippines. The regulation and supervision of the local stock market is the major function of the SEC. However, it has also assumed the role of providing market advisories against unregistered and unlicensed companies. The wording of the advisories clearly shows that the SEC prefers to have only companies and entities registered and licensed by the SEC to offer investment products to Filipinos. However, it seems powerless to enforce the laws which ban companies not licensed in Philippines from marketing their products and recruiting clients. Even though the SEC provides some investment education, this is not as robust as what is found with some other regulators.
Banks in Philippines are subject to supervision and regulation by the Bangko Sentral ng Pilipinas (BSP), which is the central bank of the country. These regulations also cover how banks buy and sell foreign exchange to the public. Hitherto, those interested in buying forex from their banks had to take permission to do so from the BSP. However, some of the restrictions have been relaxed. The BSP allows Philippine residents and non-residents to purchase forex from:
- Authorized Agent Banks (AABs)
- Affiliate Foreign Exchange Corporations (AAB-forex corps)
- Foreign Exchange Dealers (FXDs) and/or Money Changers (MCs)
Various levels of regulation govern the sale of forex by these entities. Those who earn forex (either through external trade deals or from offshore financial markets) are not mandated to exchange their forex earnings for pesos. This allows the retention of forex in domiciliary accounts.
Forex purchase limits are set to $10,000 purchase maximum (single transaction) and $50,000 maximum purchase in a month.
Currency Pairs & Spread
Philippines uses the Peso as its national currency. The Peso is not traded on the international forex or binary options online market. Therefore, Filipino traders are required to trade whatever assets they consider familiar on the binary options online platforms. Many of the platforms used by Filipino citizens to trade do not feature spreads.
Philippines binary options online traders usually trade binary options online on offshore binary options online brokers located in Cyprus and other European jurisdictions such as Malta and Bulgaria. These offshore brokers offer turnkey platforms that have been developed by companies such as SpotOption, Tech Financials, O-Systems, Tradologic and Hello Binary. A few companies located in other areas such as Belize and St.Vincent & Grenadines are still trying to make in-roads into this market.
Binary options bonuses are not awarded by brokers located within Cyprus as these have been banned by CySEC.
Deposit and Withdrawal Options
Majority of deposit transactions by Filipino traders are done using bank wires and credit/debit cards. Digital wallet use in Philippines is not very widespread, but is experiencing an uptick.
- Bank wire: This is a universal method of bank transactions and is open to all Filipinos. The use of bank wires is also fuelled by the fact that forex can be purchased by banks in Philippines.
- Credit/debit cards: Not all binary options online brokers accept credit/debit cards issued by Filipino banks.
- Digital wallets: Skrill, Neteller and Webmoney are international digital wallets which are finding increased popularity with Filipino traders. Part of this popularity is fuelled by the integration of other local e-wallets such PesoPay, PayEasy, Smart Money, WeePay DragonPay, JuanPay and GCash. These local e-wallets are also compatible with local bank cards.
Legality & Regulations
What are the legal considerations and regulatory conditions attached to the conduct of the brokerage and trading of binary options online in the Philippines?
- Binary options, forex and other speculative CFD trading instruments are presently prohibited in Philippines under Securities Regulation Code, Section 11 as well as Paragraph 4 of Rule II of the Amended Rules and Regulations. The SEC frowns at binary options online trading and actively encourages the public to report the local agents of these brokers.
- Despite this ban, many Filipino traders are still flocking to offshore binary options online brokers.
Here are the frequently asked questions that most people have about trading binary options online in Philippines.
- Are binary options online legal in Philippines?
Answer: The trading of binary options online is considered illegal in Philippines under the provisions of the Securities Regulation Code.
- Is it safe to trade binary options online in Philippines?
Answer: Binary option trading in Philippines is not very safe at the moment. Many investors have made complaints to the SEC on how they have lost money to offshore brokers. It is very likely that these losses were incurred on platforms of unlicensed brokers. The fact that unlicensed brokers are also competing with the licensed ones for the Filipino market makes it hard for many Filipino traders to know who is who.
- As a Filipino citizen, am I allowed to trade binary options online with offshore brokers?
Answer: The SEC in the Philippines regards offshore binary options online brokers as unlicensed entities. Therefore, binary option trading with offshore brokers is prohibited in Philippines. However, there is very little enforcement being done to stop local traders from trading with offshore brokers.
- Is it possible for binary options online traders in Philippines to transact on binary options online platforms using PayPal?
Answer: PayPal is not available to local Filipino binary options online traders.
Best Binary Options Brokers in Philippines
With many legal and scam binary options online brokers in Philippines, and with lots of local agents for both categories of brokers, there could be a problem with choosing the right broker. Filipino traders must therefore be very vigilant in their broker selection. The top binary options online brokers in Philippines are as follows:
Binary option traders in Philippines are presently walking a thin line. Binary option trading is considered illegal, but due to poor enforcement, is still going on at an increasing pace. It is difficult to know what the stance of the SEC will be in years to come, but for those Filipino traders who want to brave the odds, they should ensure that they use only regulated entities.