Someone gave me a cheque that bounced. What can I do in Malaysia?

A customer, tenant or friend hands you a cheque to settle what they owe. A few days later the bank returns it unpaid. What now?

Why did the cheque bounce?

Look at the bank's return slip or memo. Common reasons include:

• insufficient funds, or "refer to drawer";
• payment stopped by the drawer;
• signature or date problems, or alterations;
• the account is closed;
• the cheque is out of date (stale).

The reason matters. A technical error, such as a wrong date, may just need a replacement cheque. A stop payment or insufficient funds usually means a dispute about paying.

What rights does the Bills of Exchange Act give me?

A cheque is a bill of exchange governed by the Bills of Exchange Act 1949. When it is dishonoured, the holder can usually sue the drawer (the person who signed it), and in some cases anyone who indorsed it, for the amount of the cheque, separately from the original debt.

The Act also deals with notice of dishonour: generally, the holder should give notice to the drawer and any indorsers within a reasonable time, unless the law excuses it (for example, where the drawer stopped payment). Giving prompt written notice avoids arguments later.

Can I claim the original debt too?

Yes. The cheque was usually given to pay for goods, services, a loan or rent. You can claim on the underlying contract as well as on the cheque. Courts often treat a cheque as almost like cash, so the drawer needs a real defence to avoid paying, such as fraud or a total failure of what the cheque was for.

Because of this, cheque claims are often suited to summary judgment under the Rules of Court 2012, where the court can give judgment without a full trial if there is no real defence.

Should I make a police report?

A cheque that bounces is mainly a civil matter. A police report may be appropriate only where there are signs of dishonesty, for example where the cheque was used to trick you into handing over goods or money and the person never intended to pay. Whether any offence was committed is for the police and prosecution to assess. Report only facts you can support; never threaten a police report to force payment.

What are the steps?

1. Keep the original cheque and the bank's return slip safe. Make copies.
2. Note the return reason and the date the bank returned it.
3. Notify the drawer in writing promptly that the cheque was dishonoured, and ask for payment by a deadline.
4. Gather proof of the underlying debt: invoices, delivery orders, the tenancy agreement, loan messages.
5. Send a letter of demand if payment is not made. See the letter of demand guide.
6. File a claim in the right court, or use the small claims procedure for smaller sums.
7. Enforce the judgment if they still do not pay. See enforcing a judgment.

Have a question about your own situation? Ask on WhatsApp

Example

Siti supplies catering for an event. The organiser pays the balance by cheque, which is returned marked "payment stopped". Siti emails the organiser the same day attaching a copy of the cheque and return slip, and asks for payment within seven days. When no payment comes, she sends a letter of demand and then files a claim on both the cheque and her invoice.

Common mistakes

• Handing the original cheque back before being paid.
• Re-presenting the cheque again and again without notifying the drawer.
• Accepting a new post-dated cheque without written terms.
• Threatening the drawer or posting their name online.
• Waiting until the drawer's business closes.

When to speak to a lawyer

Speak to a lawyer if the amount is significant, the drawer disputes the debt, the cheque was given by a company, or you need to enforce a judgment. You can contact us; every case depends on its facts.

Frequently asked questions

Can I bank the cheque again?

Sometimes a cheque is paid on re-presentation, for example if funds are added. Ask the drawer first and notify them in writing.

The cheque was from a company. Can I sue the director?

Usually the company is liable, not the director personally, unless the director signed in a personal capacity or gave a guarantee.

Is giving a bad cheque a crime in Malaysia?

A bounced cheque by itself is mainly a civil matter. Dishonest conduct may be different; the police decide whether to investigate.

What if the drawer says the goods were defective?

They may raise that as a defence. Your invoices, delivery records and messages will matter.

Do banks keep records of bounced cheques?

Banks have their own policies on accounts that issue dishonoured cheques. That does not replace your claim for payment.

Sources & fact check

Legal points in this article were checked against the primary sources below. The law can change; this is general information, not legal advice.

1. Bills of Exchange Act 1949 (Act 204), AGC Laws of Malaysia
2. Rules of Court 2012 (P.U.(A) 205/2012), text published by the Malaysian Bar, including Orders 12, 13, 18, 19 and 93
3. Penal Code (Act 574), Attorney General's Chambers Laws of Malaysia

Fact-checked on 17 Oct 2026