All perfect praise be to Allah, The Lord of The Worlds, and may His blessings and peace be upon our Prophet Mohammad and upon all his family and companions.
Exchanging cheques for money or what people know as "cashing a cheque" comes in three forms:
First: Cashing cheques for less or more than their face amount. This is defined as transference of debt for a sum, and it is a form of usury(Riba). During its 7th session , the International Islamic Fiqh Academy issued a resolution prohibiting this form because it leads to Ribaa An-Nasee`ah, which is an increase in the amount due, in return for a delay in payment.
Second: Cashing deferred cheques for their exact value. This is transferring the exact amount of the cheque to someone other than the original payee. Shafii scholars have permitted this form under the condition that payment is made on the same spot. If it wasn`t, then this form becomes invalid because the Prophet(PBUH) has forbidden exchanging a debt for a debt.
Third: Exchanging cheques for certain products where the payee purchases those products against the cheque`s amount, then gives that cheque to the trader to collect it from the indebted, and this is permissible according to the Maliki jurists.
In conclusion, it isn`t permissible to cash cheques for more or less than their face amount; however, there is no harm in cashing them for their exact value with payment made on the spot, or exchanging them for certain products. And Allah knows best.
