Plus500, a leading online brokerage for CFD and foreign exchange services has been approved as a provider in South Africa.
Plus500 Acquires License to offer Services in South Africa
The Financial Services Board (FSB) has awarded Plus500 with a license to extend its financial services to traders in South Africa. The FSB is in charge of overseeing the non-banking arm of the financial industry.
This latest announcement comes following the firm’s approval as a financial service provider in New Zealand and Israel. South Africa is among the fastest growing markets but it is still comparatively underdeveloped.
In the last several years, a number of brokerage companies have obtained licensure to provide their services to traders in the country. Being a leading service provider, Plus500 could pose as a significant competitor for other brokerages already in the market.
According to Asaf Elimelech, CEO of Plus500, “This acquisition of a license to operate in South Africa is in line with our strategy, which was indicated in our preliminary results this week, to add new licenses so as to grow our global customer base and expand our revenues.”
He added, “This license further complements our recent sponsorship of Plus500 Brumbies, who are part of the international Super Rugby competition and play against teams in Japan, Argentina, Australia, New Zealand and South Africa.”
The license allows the brokerage firm to begin its operations immediately with no time limitations.
Earlier last week, Plus500 said its performance in the last quarter of 2016 was historical and associated the improvements to better market conditions characterized by high volatility following the election of Donald Trump as the US president.
At the same time, the company reported a strong recovery in margins in the second half of 2016. Shares of the CFD trading platform shot up following this announcement.
Plus500 said revenue climbed 19% from $275.6m in 2015 to $327 in 2016. Median revenue per user rose 4% from $2,019 in 2015 to $2,103 in 2016.
In 2016, the number of new customers grew 23% from 84,858 the year before to 104,432.
The brokerage further said that 2017 had continued to witness an increase in the number of new clients.
Plus500 also recorded a 14% increase in underlying earnings rising from $132.9m in 2015 to $151.0m.
This record growth was recorded amid a turbulent year as the brokerage and many other companies in the industry had to contend with an array of regulatory changes.
The firm said it is still evaluating the impact that regulatory changes have had on its business. It was however quick to add that it has a highly flexible business model that could mitigate the impact of industry regulations.