Start a Forex Brokerage in Malaysia 2026

Q: What is the difference between Labuan and SC Malaysia forex license?

Labuan IBFC is an offshore financial center with lower capital requirements ($215K), 3% tax rate, and faster processing (3-6 months). SC Malaysia is onshore regulation with higher capital ($2.15M), standard corporate tax, but greater domestic credibility. Labuan cannot serve Malaysian retail clients; SC Malaysia can.

Q: How long does it take to get a forex license in Malaysia?

Labuan IBFC Money Broking License takes 3-6 months. SC Malaysia Capital Markets Services License takes 6-12 months depending on application completeness and regulatory review. Labuan is significantly faster due to streamlined processes.

Q: Can I offer crypto trading with a Malaysia forex license?

Yes, Labuan IBFC allows digital asset trading under the Money Broking License with additional capital (RM 1,500,000 instead of RM 1,000,000). This makes Labuan one of the few regulated jurisdictions offering combined forex and crypto under one license.

Q: What are the tax benefits of a Labuan forex license?

Labuan offers either 3% tax on audited net profits or a flat $20,000 annual tax (whichever you choose). There's no withholding tax on dividends and access to Malaysia's 70+ double tax treaties. This makes it one of the most tax-efficient regulated forex jurisdictions globally.

Why Start a Forex Brokerage in Malaysia?

Malaysia offers a unique dual-licensing framework: Labuan IBFC for international/offshore operations and SC Malaysia for domestic market access. Combined with strategic ASEAN positioning, Islamic finance expertise, and competitive tax rates, Malaysia is an ideal base for forex brokerages targeting Asia-Pacific markets.

Labuan Corporate Tax Rate

70+

Double Tax Treaties

680M

ASEAN Population Access

$9,100

Labuan Setup From

Key Advantages of Malaysia

Dual-License Framework: Offshore (Labuan) + Onshore (SC) options
Islamic Finance Hub: Shariah-compliant trading expertise
Digital Asset Ready: Labuan allows crypto trading
English Legal System: Common law framework

ASEAN Gateway: Access to 680M population market
Lower Costs: 50-80% cheaper than Singapore/HK
Talent Pool: Multilingual (Malay, English, Chinese)
Time Zone: Bridge between Middle East and Asia-Pacific

Choose Your Licensing Path

Malaysia offers two distinct regulatory frameworks for forex brokerages.

RECOMMENDED

Labuan IBFC

Offshore Financial Centre

$9,100

Setup cost (excl. capital)

Capital: RM 1M (~$215,000)
Tax: 3% or $20,000 flat
Timeline: 3-6 months
Crypto trading allowed
100% foreign ownership
Cannot serve Malaysian retail

Learn About Labuan License

SC Malaysia

Securities Commission (Onshore)

$50,000+

Setup cost (excl. capital)

Capital: RM 10M (~$2.15M)
Tax: 24% corporate rate
Timeline: 6-12 months
Serve Malaysian retail
Higher domestic credibility
Stricter requirements

Discuss SC Malaysia Option

Feature	Labuan IBFC	SC Malaysia
Regulator	Labuan FSA	Securities Commission
Minimum Capital	RM 1,000,000	RM 10,000,000
Corporate Tax	3% or $20K flat	24%
Processing Time	3-6 months	6-12 months
Crypto Trading	✓	✗
Serve Malaysian Retail	✗	✓
Foreign Ownership	100%	100% (recent change)
Best For	International brokers, Asia-Pacific focus	Malaysian domestic market

Labuan IBFC: Step-by-Step Setup Guide

The recommended path for international forex brokerages targeting Asia-Pacific markets.

Initial Consultation & Planning

Assess your business model, target markets, and determine if Labuan is the right fit. Prepare preliminary documentation.

• Define business scope (forex, crypto, or both)
• Identify target client segments

• Prepare shareholder documentation
• Draft initial business plan

Company Incorporation in Labuan

Required:

• Passport copies of directors
• Proof of address
• Company name reservation

Included:

• Memorandum & Articles
• Certificate of Incorporation
• Resident Secretary appointment

Deposit Capital & Open Bank Account

Deposit minimum capital with a regulated Malaysian bank. This capital must remain unimpaired at all times.

RM 1,000,000

Forex Only (~$215,000)

RM 1,500,000

Forex + Crypto (~$325,000)

Submit Money Broking License Application

Submit complete application to Labuan FSA with all supporting documentation.

Application Package:

• Regulatory business plan
• Fit & proper assessments
• AML/CFT policies
• Risk management framework

Key Personnel:

• Minimum 2 directors
• 3+ years forex experience
• Principal Officer in Labuan
• Compliance Officer

Set Up Technology & Operations

Deploy your technology stack while license is processing. Be ready to launch when approved.

Trading Platforms

• MT4 / MT5
• cTrader
• MatchTrader

Back Office

• Forex CRM
• Trader's Room
• IB Management

Compliance

• KYC/AML tools
• Transaction monitoring
• Reporting systems

Brokeret provides complete technology for Malaysia brokers: CRM, Trader's Room, IB management, and integrations with all major platforms. Malay and Chinese language support included.

Receive License & Launch

Upon Labuan FSA approval, receive your Money Broking License and begin client onboarding.

Launch Checklist:

• System testing complete
• Staff training complete
• Website & portal live

Go-Live:

• Begin client onboarding
• Execute marketing plan
• Ongoing compliance

Labuan IBFC: Complete Cost Breakdown

Transparent pricing for launching your Labuan forex brokerage.

First-Year Setup Costs

Company Incorporation $4,200

LFSA License Fee $1,600

Employment Pass (1 person) $2,250

Office Rental (6 months) $150

Bank Account Opening $650

Miscellaneous $250

Total Setup $9,100

Annual Operating Costs

Secretary & Office $3,350

Tax Filing & E-Employer $630

Miscellaneous $800

Annual Renewal $4,780

Capital Requirements:

• Forex only: RM 1,000,000 (~$215,000)
• Forex + Crypto: RM 1,500,000 (~$325,000)

Total First-Year Investment: $225,000 - $335,000

Including setup, capital, and first year operations. Significantly lower than Singapore or Hong Kong alternatives.

Labuan Tax Advantages

Profit-Based Tax

Tax on audited net profits

Best for: High-profit brokerages

$20K

Flat Annual Tax

Fixed amount regardless of profit

Best for: Startups & smaller brokers

No Withholding Tax

On dividends or royalties

70+ Tax Treaties

Access to Malaysia's DTAs

Flexible Choice

Switch between options annually

FAQ

Frequently Asked Questions

Common questions about starting a forex brokerage in Malaysia.

How much does it cost to start a forex brokerage in Malaysia?

Labuan IBFC setup costs start from $9,100 (excluding capital), with minimum capital of RM 1,000,000 (~$215,000). SC Malaysia requires higher capital of RM 10,000,000 (~$2.15M). Total first-year costs for Labuan range from $225,000-$300,000 including capital, setup, and operations.

How to Start a Forex Brokerage in Malaysia: Complete Guide