NCM Investment, a financial brokerage firm headquartered in Kuwait, was established in 2009. NCM Investment specializes in financial instruments, including FX, commodities, precious metals, CFDs, and related products.

Recently, the firm has been authorized by the Financial Conduct Authority (FCA) as NCM Financial UK Ltd. This authorization indicates that the firm meets the FCA's standards for financial operations and consumer protection.

FSCS Coverage for NCM

The FCA's authorization of NCM Financial UK Ltd includes specific permissions for various financial activities. Consumers dealing with NCM Financial UK Ltd have certain protections.

If the firm goes out of business and owes money, one may be eligible to claim compensation from the Financial Services Compensation Scheme (FSCS). Additionally, there is a right to file a complaint with the Financial Ombudsman Service if issues arise with the firm's services.

The firm has also expanded its reach to Jordan, Turkey, Malaysia, and the UAE.

FCA on Promotions and Trading Apps

In the first quarter of 2024, the FCA ordered the amendment or withdrawal of 2,211 financial promotions, as Finance Magnates reported. The retail investment and retail lending sectors are the most affected, accounting for 85% of interventions.

The FCA also received 5,722 reports of potential unauthorized activities and issued 597 alerts, 11% of which were related to clone scams. These scams involve fraudsters impersonating authorized firms to deceive consumers, often through online breaches of financial promotion rules.

Meanwhile, the FCA is scrutinizing trading apps due to concerns that digital engagement practices (DEPs) may encourage excessive risk-taking among investors.

A recent study using an experimental trading app platform, involving over 9,000 consumers, revealed that features like push notifications and prize draws increased trading frequency and riskier decisions by 11% and 12%, respectively.

Gamification strategies also led to an 8% and 6% rise in risky investments. The impact was more pronounced among individuals with low financial literacy, women, and those aged 18-34. Under the FCA's Consumer Duty, trading apps must design services that enable informed investment choices.