Why offshore forex apps are illegal for residents

The ads you have seen

Trade EUR/USD from your phone, deposit by UPI, start with ₹1,000, free demo, friendly “account manager” on WhatsApp. These apps advertise heavily in India. Almost none of them may legally take a position for a resident of India.

What the law allows

Under the Foreign Exchange Management Act, 1999 (FEMA), a resident may deal in foreign exchange only with persons authorised by the Reserve Bank of India (RBI), and only for permitted purposes. For trading, the permitted route is exchange-traded currency derivatives on a recognised Indian exchange — NSE, BSE or MSE — through a SEBI-registered broker. Online forex or CFD trading with an offshore platform is not a permitted purpose (as of 3 November 2026).

The RBI Alert List

RBI first warned the public about unauthorised forex trading platforms on 3 February 2022 and published its Alert List on 7 September 2022. The list names platforms and websites that are not authorised to deal in forex or to run an electronic trading platform for forex — and also sites that advertise them or claim to offer training or advisory services about them. It is updated from time to time; the latest update we checked is 19 November 2025. RBI says the list is not exhaustive: a platform that is missing from it is not thereby authorised.

The software is on the list too

The Alert List does not only name brokers. It also names trading software that offshore brokers hand to their clients, and websites that publish forex “signals” or “education” to bring people to those brokers. In February 2023 RBI also warned specifically about “training/advisory services” on social media and video platforms that offer “demo trading” in a “simulated environment” as a way into unauthorised platforms. So downloading a popular trading terminal to trade with an offshore broker, or following a channel that coaches you into one, puts you in the same place.

Warning signs

An unauthorised platform rarely says so. The tells repeat:

What is at stake

A resident who trades forex through an unauthorised platform contravenes FEMA. Under section 13 of FEMA the adjudicating authority can impose a penalty of up to three times the sum involved where it can be quantified (up to ₹2 lakh where it cannot), plus up to ₹5,000 for every day the contravention continues (as of 3 November 2026). There is also the practical risk: money sent to such platforms has often been impossible to recover, and enforcement agencies have frozen bank accounts used to collect deposits.

You’ve mastered: offshore forex apps

Residents may trade currencies only through exchange-traded currency derivatives on NSE, BSE or MSE, via a SEBI-registered broker

Offshore forex, CFD and binary platforms are not authorised, and LRS money may not be used for margin abroad

The RBI Alert List names platforms, trading software and promoters, including “training” channels — and it is not exhaustive

Breaching FEMA can cost up to three times the sum involved