What are IPO funds blocking for ASBA application?

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 Investors continue to enjoy interest on the blocked amount until it is withdrawn.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.