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ASBA is a mechanism used to submit bids in a public offering. ASBA gives the Self-Certified Syndicate Bank (SCSB) permission to block funds in the applicant's bank account in exchange for subscribing to the offering.
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ASBA stands for Application Supported by Blocked Amount. It was introduced in 2008. The ASBA facility is used by all types of investors, including retail investors, non-institutional investors (NII) and qualified institutional buyers (QIB).
ASBA is a method of applying for shares in an IPO. ASBA gives the Self-Certified Syndicate Bank (SCSB) permission to block funds in the applicant's bank account in exchange for subscribing to the offering.
When an investor applies in an IPO through ASBA, his/her application funds are blocked in the bank account. If the investor receives the allotment, the funds will be deducted from the account. If there is no allotment of shares, the money will be released from the investor's bank account on the day of the final allotment.
The ASBA route is the easiest, fastest and most convenient way to apply or bid for an IPO. One of the biggest advantages to investors is that they continue to receive interest on the blocked amount.
ASBA has simplified and accelerated the IPO process by blocking funds as soon as investors confirm the payment. This eliminates the need to pay money via cheques and demand drafts.
Investors can apply for an IPO with ASBA in either online or offline mode. The ASBA online IPO process is much easier than the offline ASBA process.
The online ASBA IPO application can be submitted through the net banking services of the bank providing ASBA facility.
Steps for ASBA IPO online application:
Note:
The process mentioned in the above ASBA IPO application is a general process. Investors need to contact their bank to know the more specific details of the process.
Investors can apply for an offline IPO by submitting the duly completed Physical IPO Application Form/ASBA forms at the nearest Self Certified Syndicate Bank (SCSB) branch.
Offline IPO application is a somewhat lengthy, manual and time-consuming process.
Steps for offline IPO application via ASBA:
Resident Indians, i.e., resident individuals, QIBs, NIIs, and eligible NRIs (applying on non-repatriation basis) should use the white application form. FPIs applying on repatriation basis should use the blue application form (applies when a physical copy is requested).
The ASBA application form can be downloaded from the NSE/BSE website or obtained from one's broker/lead manager. These ASBA forms can then be submitted to apply for an IPO in offline mode.
Originally, there were only physical paper forms. Since July 2010, ASBA forms were also made available online.
ASBA IPO e-Form
The online ASBA IPO forms can be downloaded from either the NSE or BSE websites.
Links for ASBA IPO application form download :
Using the ASBA BSE forms, investors can download only blank forms (new/revised). However, the ASBA NSE website provides the option to download either a blank ASBA IPO form or a pre-filled form with personal information (new/revised form).
The ASBA NSE IPO form allows investors the advantage of entering their details only once by registering and creating a user id. During registration, investors need to enter their personal information such as name, PAN, DP and bank details correctly. After registration, the data will be saved in their profile and only prints are needed of the pre-filled form. This saves the hassles of manually entering the bid data and amount in the form.
Another advantage of the ASBA NSE is the possibility to fill in all the details on the screen before printing the bidding form without registration.
Refer to the ASBA NSE IPO forms user guide for more details.
There are no charges to apply using the ASBA facility.
Refer to the bank-wise cut-off time for ASBA IPO application (on last day).
Third-party IPO application was an option granted by a few banks in India. This allowed investors to submit multiple IPO applications (up to 5 applications) for an IPO from one bank account through a Net banking facility.
However, from May 1, 2022, this facility is no longer available. No bank in India offers the facility to submit IPO applications through third parties.
ASBA and UPI are the modes of IPO applications. Investors can use any of these ways to apply online or offline.
ASBA was introduced in 2008 and has been made mandatory for all IPO applications since 2016. In 2019, SEBI introduced UPI as the payment mechanism for IPO applications. The goal was to drive the digitization of offline processes in the application process.
ASBA and the UPI IPO application work on a similar fundamental mechanism. This means that the investor's bank account is blocked with the application amount after the UPI mandate is approved. Therefore, UPI is sometimes referred to as the UPI ASBA process.
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ASBA |
UPI |
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Requires a bank account at one of the ASBA-supported banks. |
Requires a UPI ID. |
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Comparatively faster, as the online application requires only bidding data to be entered. |
Fast. Requires input of UPI ID along with bid details and also requires approval of the UPI mandate. |
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No smartphone is required to apply using the ASBA facility. |
Requires a smartphone for UPI IPO application. |
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The offline ASBA form must be submitted at one of the nearest SCSB branches. |
The offline form using UPI as mode of payment can be submitted to any of the intermediaries - broker, syndicate member, DP, registrar but not SCSB. |
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The fund blocking is done by the bank. |
Funds will be blocked upon approval of the UPI mandate. |
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IPO application for a minor possible if the bank provides Netbanking access for the minor; else investors can submit the offline form. |
IPO application for minors is not possible as UPI ID cannot be created for minors. |
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Available to all categories of investors except anchor investors. |
Available only for individual investors to apply up to Rs 5 lakhs. |
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ASBA facility is offered only by banks. |
UPI facility is offered by both banks and brokers. |
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Pre-IPO application is not possible. |
Pre- IPO application possible provided the broker offers the said facility. |
ASBA for IPO is the payment mode that helps investors to apply for an IPO easily and quickly.
ASBA stands for Application Supported by Blocked Amount. It is an IPO application process that provides authorization to the Self-Certified Syndicate Bank (SCSB) to block funds for the IPO from the applicant's bank account for subscribing to an issue.
With ASBA, the application amount is not debited from the bank account until investors receive an allotment. Investors can use the ASBA method to apply for an IPO either online or offline. Once the payment is completed, the bank will block the amount from the ASBA account number.
The ASBA facility is a method that allows SCSBs to block the application amount from the investor's bank account. The amount is not deducted, it is only blocked. The investor continues to receive interest if applicable on the amount till it is debited.
Investors can make the request directly through their SCSB bank application or website.
For example, investor AB has a Citibank account and the bank offers an ASBA facility. The investor can either submit an online application through Citibank net banking services or pick up a physical form at a bank branch. The duly completed physical form has to be submitted, indicating the Citibank ASBA account no.
The ASBA procedure was introduced by SEBI in a circular dated July 30, 2008, and became effective for all book building public issues opened on or after September 1, 2008.
ASBA was introduced in a phased manner as an offering available with certain restrictions only to retail investors. Ultimately, as of January 2016, ASBA became mandatory for all categories of investors except anchor investors.
ASBA is a payment method that allows banks to block funds paid for the purchase of IPO shares. These funds are only blocked and not deducted from the account. Thus, these funds continue to earn interest until they are deducted at the time of allotment.
The ASBA facility has simplified IPO trading at zero cost. The ASBA has eliminated the need for demand drafts and cheques for payments.
ASBA is a method of applying for an IPO based on the fund-blocking mechanism.
The ASBA IPO full form means to apply for an IPO using the Application Supported by Blocked Amount. To apply for an IPO through ASBA, investors need to have an account with an ASBA-enabled bank.
The ASBA facility authorizes these banks (SCSBs) to block funds for the IPO application or for a public offering.
ASBA works on the fund blocking mechanism.
In the ASBA mode of payment, the investor account is not debited at the time of application. The ASBA application authorises the bank to block the application amount from the investor's account.
The blocked funds will continue to earn interest. Funds will only be debited when investors receive an allotment. The amount debited will also depend on the allotment, whether it is a full allotment or a partial allotment. In case of partial allotment, the remaining funds will be released after the allotment on the refund date and investors can use them.
To apply for an IPO with ASBA, investors must have an account with an ASBA-supporting bank.
The ASBA designated branches are the SCSB bank/ branches that offer the facility to apply for an IPO using ASBA.
Investors can apply for an IPO online or offline through these ASBA supported banks using their Netbanking services or walk-in services respectively.
Attached is the list of SEBI Registered SCSB's for easy reference.
Yes, ASBA bids can be cancelled or withdrawn only by retail investors while the issue is open for subscription.
Investors can cancel the bid online or offline. Employees can also cancel their bids provided their application amount is less than or equal to Rs 2 lakhs. Only NIIs and QIBs cannot cancel or withdraw their bids once applied for.
The ASBA IPO application can be cancelled online or offline only by retail investors during the IPO subscription period.
Steps to cancel the ASBA application online
Steps to cancel ASBA IPO application offline
Note : On the last day, some banks may not accept withdrawal requests till 5 PM. Therefore, check with the respective bank for the exact procedure.
There are no fees charged by any bank or broker for cancelling an IPO application. Investors do not have to pay any fees to cancel an IPO application, either through ASBA or UPI.
Yes, only the retail investors can cancel the ASBA application.
The ASBA application can be cancelled online by logging to the Netbanking account through which the application was made. Upon clicking on the transaction number, withdraw/delete/cancel the bid and the application will be cancelled.
For offline IPO applications, investors need to contact the respective intermediary through which the application was submitted. Investors need to request a cancellation through a duly signed letter.
Investors can apply using UPI ID (here we can link the chapter of UPI IPO application) if investors do not want to apply using the ASBA route. UPI IPO application is also based on the fund blocking mechanism. UPI payment mode includes an additional mandate approval step for the successful submission of the application. To apply through UPI, investors will need a UPI ID.
Applying for an IPO through UPI can also be done through the broker's trading platform, if the investor's broker offers the UPI IPO facility.
No, you cannot withdraw the amount blocked for IPO application using the ASBA route.
When you apply for an IPO using the ASBA mode of payment, the bank marks a lien on the application amount and blocks it for IPO. You continue to earn interest on the said amount, but you will not be able to use it unless the hold is lifted.
The IPO application amount lock will only be lifted if you withdraw/cancel or delete the application or if you do not receive an allotment/partial allotment. The bank needs a few days to lift the lien on the amount after the respective events. Subsequently, you can withdraw the amount from the account.
Investors can apply for an IPO using ASBA either online using the Netbanking services or offline by submitting the offline IPO application form to the nearest broker/bank branch.
Steps to apply online for IPO through ASBA procedure
Note : The personal details are generally required to be entered only for the first time when investors apply using their Net banking services.
Steps for offline ASBA IPO process
The ASBA IPO online process is simpler than the offline IPO application through ASBA.
To apply for an IPO online using ASBA services, investors need the below:
Steps for online IPO application via ASBA
Note: Personal details like Name, PAN, Demat account, Email ID would get auto-picked from the profile based on the information filled at the time of first application/registration.
Investors can pay through ASBA online using the Netbanking services or offline by submitting the ASBA IPO application form to the nearest bank branch.
To pay through Netbanking, investors must log in to their ASBA-enabled bank account and apply for the IPO option through the bank's mobile app or web. Investors should ensure that the account has sufficient funds to apply for an IPO.
Once the application is submitted, the amount will be blocked from the bank account.
ASBA facility is available with almost all major and recognised banks like HDFC, ICICI, Citibank, Axis, Bank of Baroda, IDBI, HSBC, SBI etc. There are also many other banks that offer ASBA services.
Click on the link for quick reference to the list of banks with ASBA facility.
The ASBA IPO forms contain five main parts viz. Investor Details, Bidding Details, Payment Details, Signature and the Counterfoil.
NSE has an option wherein investors can either ;
Refer to the NSE ASBA e-forms Manual for details.
In case of online application, investors generally need to enter only the bidding details to submit the IPO application.
The third party ASBA was a facility that allowed individuals to submit multiple IPO applications from one bank account.
The investor could submit up to 5 applications from one bank account. This facility was used to apply for an IPO for minors. However, effective May 1, 2022, all banks no longer offer the option of applying through a 3rd party ASBA IPO. As per the new rules the PAN number of the primary account holder in the bank account and demat account should be the same for valid IPO applications.
Yes, you can apply for an IPO through ASBA. ASBA is mandatory for all investors applying for public offerings.
Investors can apply online or offline using ASBA. The online ASBA application can be done through Net banking. The offline ASBA application can be done by submitting ASBA IPO form to any of the nearest bank branches.
The ASBA IPO requires a bank account with any one of the ASBA enabled banks and access to Netbanking services to apply for IPO online.
Non ASBA IPO was the IPO payment method, where the bank account was debited with the respective application amount.
Prior to ASBA and for some time thereafter, the payment method was Non ASBA IPO, where payment for the IPO application was made with cheques and demand drafts.
However, with the introduction of ASBA, IPO applications are now only possible via ASBA or via UPI.
ASBA is a facility offered by SCSBs to block the application amount from the investor's bank account for subscribing to an IPO.
Steps to understand the working mechanism of ASBA
Yes, ASBA is required for all IPO applications and investors in general.
ASBA has been made mandatory for all IPO applications by SEBI except for Anchor Investors.
Investors have two options to apply for an IPO using ASBA.
The physical ASBA form can be submitted to any of the nearest branches of any of the banks offering ASBA services.
Click on the link to refer to the list of the ASBA IPO bank list SEBI.
Investors can also submit the application online using the ASBA Net banking services of the above banks.
Investors can participate in the IPO either online or offline through a bank account that provides ASBA services.
Steps to apply for an IPO through ASBA:
Investors must ensure that they have sufficient bank balance, which should not be less than the requested IPO application amount.
IPO Fund Blocking is a facility that only blocks the IPO application amount in the investor's bank account under the ASBA route.
In ASBA, funds are not debited from the investor's bank account until they receive an allotment. The full form of ASBA is "Application Supported by Blocked Amount". ASBA works on the mechanism of blocked funds. This means that the funds remain blocked in the bank account. Investors continue to enjoy interest on the blocked amount until it is withdrawn.
Note: It does not block the entire bank account. Only the amount that ASBA has approved as application money will be blocked. If there is still money in the account, it can be used for other purposes.
ASBA is the facility used to block the amount from the investor's bank account by SCSBs to apply for an IPO.
All investors need is a bank account with one of the SCSBs that offer the ASBA facility. The ASBA application authorizes the SCSB to block the amount of the IPO application from the investor's bank account. The amount will only be debited if investors receive an allotment in an IPO. The amount of the debit also depends on the amount of the allotment in an IPO.
Investors can apply online or offline through ASBA.
Investors can invest in an IPO through ASBA by either using ASBA Bank's Net banking services or by filing the IPO form at the nearest SCSB.
Steps to invest in IPO online through ASBA
Steps to invest in IPO through ASBA using the offline mode
ASBA means "Application Supported by Blocked Amount." The ASBA is a facility offered by self-certified syndicate banks to block the application money in the bank account for subscribing to an issue.
The amount blocked for IPO application cannot be used for any other purpose. However, the amount will continue to earn interest until it is debited in the event of an allotment. If no allotment takes place, the blocked amount is released again.
To apply for ASBA shares, investors must have an account with one of the banks that offer the ASBA facility.
ASBA and UPI were introduced by SEBI with the intention of making the IPO application process simpler, more efficient, convenient and time efficient for IPOs.
The introduction of ASBA eliminated the use of cheques and demand drafts for the IPO application. The introduction of the UPI IPO application is another step towards digitizing the process and removing offline processes in the IPO application process.
Benefits of using ASBA
Benefits of using UPI
Yes, investors can apply through the ASBA facility.
ASBA is mandatory for all investors applying for an IPO. Investors can apply through ASBA using their UPI ID or Net Banking account. Both payment methods will only block the amount from their account.
Investors need to have a bank account with any of the SCSB banks registered with SEBI approved to provide the ASBA services.
For online ASBA IPO applications, investors also need to have access to Net banking services for the IPO application. There is no other separate registration process for ASBA.
Investors can apply online or offline using ASBA bank account information, which will be blocked with the IPO application amount.
To register an ASBA facility, investors need to register with SCSB (SEBI registered). Investors can check the list of SCSBs in the attached link.
The following steps help register for ASBA :
No, you may either complete the physical ASBA form available from the SCSB and submit it to the SCSB. Alternatively, submit the application electronically through the ASBA bank's Net banking services.
UPI ASBA application process is subscribing to an IPO using the UPI gateway.
Steps to apply for an IPO using ASBA through UPI
ASBA payment mode is the facility introduced by SEBI that allows banks to block the amount for IPO applications upon receipt of an ASBA application from investors.
The amount will be debited from the bank account only when investors receive the allotment. The blocked amount will continue to earn interest (if held in an interest-bearing bank account) during the application processing period.
If the bid is accepted, the bank will debit the account and the allotted shares will get to the applicant's demat account. If no allotment is made, the amount will be unblocked from the account.
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