UAE Cheque Bounce Laws in 2025
The law on cheque bounce in the UAE has changed a lot in the last few years. Many people still assume that every bounced cheque automatically becomes a criminal case, but that is no longer true. The major amendments that came into force in 2023 continue to apply in 2025, and the focus today is more on civil recovery rather than criminal punishment.
A cheque is treated as a binding payment instrument in the UAE. When someone issues a cheque, the law expects that the drawer has enough balance in the account on the date the cheque is presented. If the cheque is returned due to insufficient funds, wrong signature, account restrictions, or a stop-payment instruction without a valid legal reason, it is considered a dishonoured cheque.
Under the amended law, most cheque bounce matters fall under civil enforcement, not criminal courts. This means the beneficiary can take the returned cheque along with the bank’s return memo and file it directly before the execution court. The court can then take action such as freezing the drawer’s bank accounts, seizing assets, ordering salary deductions, and restricting the debtor from travelling until the amount is settled. This process is faster than the earlier criminal route and is intended to speed up recovery.
The law also allows partial payment. If there is some amount available in the drawer’s account, the bank must release that portion instead of rejecting the cheque completely. The remaining balance can still be claimed through civil enforcement. This provision helps reduce disputes and ensures that at least part of the money reaches the beneficiary without delay.
Although the law has reduced criminal consequences for routine cheque bounce cases, it has not removed criminal liability entirely. Criminal charges may still apply when there is clear evidence of fraud or bad faith. Examples include issuing a cheque from a closed account, deliberately withdrawing funds after issuing a cheque so that it cannot be honoured, forging a cheque, stopping payment to cause harm, or misusing cheques in a way that shows intent to deceive. These situations can lead to fines or imprisonment depending on the seriousness of the conduct.
For individuals and businesses, the practical steps are straightforward. If you receive a bounced cheque, the first document you need is the bank’s return memo. Without this, you cannot proceed with enforcement. Once you have the memo, you can file the case with the execution court and request the available measures for recovery. There is no need to start with a police complaint unless the situation suggests fraud.
For the person issuing cheques, the main point is to be cautious. Do not issue cheques unless you are sure the funds will be available. Avoid stop-payment requests unless you have a strong legal reason. Keep your signature updated with the bank, and ensure your account is active and not restricted.
In 2025, the law tries to limit criminal complaints and make civil recovery more straightforward. It also expects cheque issuers to act more responsibly. Anyone who uses cheques—whether for rent, business, or regular payments—should understand the present rules to steer clear of issues.
