Cashing cheques in foreign currencies

Cashing a foreign currency cheque in the UK isn’t always straightforward and can be a long-winded process. If you receive a cheque in euros, dollars or another foreign currency, here’s what to do.

Cashing a foreign currency cheque in the UK isn’t always straightforward and can be a long-winded process. If you receive a cheque in euros, dollars or another foreign currency, here’s what to do.

Alex Hasty
Insurance and finance expert
minute read
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Posted 5 AUGUST 2021

Can you pay foreign cheques into UK banks?

Yes, most of the big high street banks will let you, including Barclays, HSBC, NatWest, Lloyds and Santander. 
If you need to access the funds quickly, an online bank transfer is usually a better option than trying to cash a cheque.  

What should I do if I receive a cheque in a foreign currency?

In this day and age, receiving a cheque in a foreign currency is relatively rare. But if you are given one, you’ll firstly need to find out if you can pay it into your current account.  

If your bank does accept foreign cheques, you’ll usually need to pop into a branch to pay it into your account, or send it to your bank in the post. 

Cheques have to go through a clearing process, where the amount written on the cheque is transferred between the sender and receiver’s accounts to settle the payment. Under normal circumstances, this only takes around one to two working days after the cheque is paid in. But if the cheque is made out in a foreign currency, it can slow the process. Foreign currency cheque clearing can take several weeks and it’s likely you’ll face extra charges. 

The cheque may be cancelled if you haven’t presented it to your bank within six months of receiving it. 

How are foreign cheques paid?

There are two ways a bank can process a foreign cheque, either by a negotiation or collection service. The method they use to pay the money into your account will depend on where the cheque comes from, and what currency it’s in.  
Cheque negotiation 
This system lets you use the money before the cheque has cleared. But bear in mind that if the cheque bounces or is stopped, the money can be taken back out of your account.  
The funds are usually paid into your account within 3-6 working days of you paying in the cheque, but may sometimes take slightly longer.  
You’ll usually be charged a fee for payment of a cheque by negotiation. This might be a set figure or a percentage of the cheque amount. 
Cheque negotiation will only be used for cheques made out in the currency of the sender’s country, for example a cheque from Canada made out in Canadian dollars. If you received a Canadian cheque made out in euros instead, it would need to be paid by collection.  
Cheque collection 
With cheques paid by collection, your bank will wait for the cheque to clear – and they’ll wait for the foreign bank to confirm the transaction – before crediting your account. This can be a lengthy process, often taking up to 7 weeks or longer. And as with cheque negotiation, you’ll usually be charged a fee for this. 
The collection method will probably be used if the cheque is made out in a different currency to the one used in the country it came from, or if it’s from a country your bank deems to be high risk. 

Can exchange rates affect the value of foreign cheques?

Yes. Your bank can set its own rate of exchange to calculate the sterling equivalent of the foreign currency amount. This may not always be the most competitive rate on the market.  
You might also find that the rate changes between the time you present the cheque to your bank and the point at which it clears , especially if it takes several weeks to process. This means you could get less money than you would have got on the day the cheque was paid in. But, on the flip side, you could also get more. 

Anything else I should know about cashing a cheque in a foreign currency?

While it’s certainly still possible to cash a foreign cheque in the UK, there are now easier ways to transfer money between countries, and many online and smaller banks won’t even accept international cheques.   
It’s important to remember that you should never accept a cheque from someone you don't know or trust, especially as fraud can be a big issue with foreign cheques. 
An electronic cash transfer is the safest and fastest way to move funds into your account from overseas. So, if possible, it may be better to ask the person paying you, to organise a bank transfer instead of writing a cheque. 
You’ll need to provide them with your International Bank Account Number (IBAN) and Bank Identifier Code (BIC). These act in a similar way to sort codes and current account numbers. You can find these numbers in your account details on your mobile banking app or online current account. While you could still face some pretty steep fees and exchange rates, the processing time is significantly less. 

Frequently asked questions

Do all banks charge the same to cash a foreign cheque?

No, fees vary between banks. Some will charge a flat fee, for example £10, while others will charge a percentage of the cheque amount – or even a combination of both. Ask your bank for more information. 

How do I pay in a foreign cheque?

You should check with your bank what you’ll need to do, as you may have to go into your local branch. Alternatively, you may be able to send the cheque to your bank’s international payments office to be processed. Make sure you sign the back of the cheque and include the sort code and account number you want it to be paid into. It’s also worth making a photocopy of the cheque for your own records. 

What is cheque recourse?

Cheque recourse is when your bank takes the money back from you if the cheque is stopped or returned unpaid. It can take several weeks for a foreign cheque to clear, and the cheque could bounce during this time. What’s more, a foreign cheque can still be returned up to 7 years from the date it was issued if fraud is identified.  

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