The UK’s Financial Conduct Authority (FCA) has completed a fresh review of trading apps and neobrokers, raising red flags over issues that directly impact both retail traders and the proprietary trading space.

Key Findings

According to the FCA, many trading platforms are falling short in several critical areas:

• Lack of Adequate Suitability Checks: Some apps fail to assess whether users understand the risks involved in trading complex products.
  
  
• Overuse of Engagement Features: Push notifications, gamification, and real-time alerts may be driving impulsive trading behaviors.
  
  
• Revenue Model Transparency: Several neobrokers operate on unclear or opaque monetization structures, including subscription models and interest on idle funds.

Why It Matters to Prop Traders

While most prop firms operate separately from traditional brokers, many traders interact with both ecosystems. The FCA's findings are a reminder of how platform design choices can influence behavior—especially for new or high-frequency traders.

Prop firms may want to consider:

• How platform incentives affect trader psychology
  
  
• Whether similar risks exist within their own trading interfaces or educational programs
  
  
• The importance of clear disclosures, especially around fees and trading conditions

FCA's Call to Action

The FCA is urging firms to:

• Conduct more robust onboarding processes
• Avoid gamification techniques that encourage excessive risk-taking
• Be transparent about how they earn money

“Firms should ensure they promote good outcomes for consumers, including those with characteristics of vulnerability,” the FCA stated.

Final Thoughts

The FCA’s scrutiny serves as a wake-up call for the trading industry as a whole—including prop firms. As more traders enter the markets via mobile-first platforms and hybrid models, the line between traditional retail and prop environments is blurring.

For prop trading companies, adopting clearer disclosures, stronger trader onboarding, and behavior-aware design could be key differentiators in a more regulated future.