ASBA IPO

ASBA IPO, or Application Supported by Blocked Amount, is a system facilitating bid submissions for public offerings. Introduced in 2008, it enables Self-Certified Syndicate Banks (SCSBs) to block funds in applicants’ accounts for subscription. ASBA is widely used across investor categories, including retail, non-institutional, and qualified institutional buyers (QIBs).

ASBA IPO Meaning

ASBA, or Application Supported by Blocked Amount, is a streamlined method for participating in IPOs. Through ASBA, Self-Certified Syndicate Banks (SCSBs) are authorized to reserve funds in applicants’ bank accounts while subscribing to the offering. When an investor opts for ASBA, the application funds are temporarily blocked in their bank account. If shares are allotted, the corresponding funds are deducted from the account. Conversely, if no shares are allocated, the blocked amount is released on the final allotment day.

This approach offers several benefits, including ease, speed, and convenience. Investors appreciate ASBA for its simplicity and efficiency in the application process. Moreover, ASBA ensures that investors continue to accrue interest on the blocked funds until the final allotment day. Overall, ASBA has become a preferred choice for IPO applications due to its user-friendly nature and the financial advantages it offers to investors.

ASBA Features

• ASBA allows investors to apply for an IPO through online or offline channels.
• Application funds are not debited immediately; instead, the SCSB blocks the corresponding amount in the investor’s bank account.
• Investors earn interest on the blocked amount until it is debited upon allotment.
• If there’s no allotment or partial allotment, the lien on the amount is lifted after allotment results are announced.
• Unlike UPI, ASBA does not require mandate approval, simplifying the application process.

Online ASBA IPO Application Process

Submitting an ASBA IPO application online streamlines the process and offers convenience to investors. Here’s how to apply for an IPO online using ASBA:

1. Log in to Net Banking: Access your bank’s net banking portal that offers ASBA services.
2. Navigate to Investments: Find the IPO menu under the Investments or Securities section.
3. Select IPO: Choose the desired IPO from the list available for application.
4. Fill in Applicant Details: Provide essential details such as applicant name, PAN number, and Demat account information.
5. Enter Bid Details: Specify bid details including quantity and price per share.
6. Submit Application: Review the application and submit it through the online platform.

Note:

• Initial registration of applicant details may be required, which is usually a one-time process.
• Some banks may require additional authentication, such as OTP verification.
• Investors should consult their bank for specific instructions and procedures.

Offline ASBA IPO Application Process

Submitting an ASBA IPO application offline involves manual steps and requires visiting the nearest Self Certified Syndicate Bank (SCSB) branch.

Steps for Offline ASBA IPO Application:

1. Obtain Application Form: Procure the Physical IPO Application Form/ASBA forms from your broker or download them from the NSE or BSE website.
2. Fill in Personal Details: Complete the form with personal information including Name, Address, Contact No., Demat Account, and PAN.
3. Enter Bid Details: Specify bid details such as quantity, price, and select the investor category and status.
4. Provide Payment Details: Enter payment details by providing either ASBA bank account number or UPI ID.
5. Sign the Form: Sign the form to authenticate the application.
6. Submit the Form: Visit the nearest SCSB branch and submit the completed form.
7. Collect Acknowledgment: Collect the counterfoil provided by the SCSB branch as proof of submission.

Additional Information:

• Resident Indians and eligible NRIs should use the white application form, while FPIs applying on a repatriation basis should use the blue application form when requested for a physical copy.

ASBA IPO Application Form

Investors can access the ASBA application form from the NSE/BSE websites or through their broker/lead manager to apply for IPOs offline.

ASBA Forms Evolution:

Originally, only physical paper forms were available, but since July 2010, online ASBA forms have been introduced.

ASBA IPO e-Forms:

Online ASBA IPO forms are downloadable from the NSE or BSE websites.

Downloading ASBA IPO Forms:

• BSE ASBA forms provide blank forms only.
• NSE ASBA forms offer blank or pre-filled forms with personal information.

Advantages of NSE ASBA Forms:

• Pre-filled forms streamline the application process, reducing manual data entry.
• Investors can register and save their details for future use.
• Option to fill in details online before printing the form without registration.

Additional Resources:

Refer to the ASBA NSE IPO forms user guide for comprehensive instructions.

ASBA Charges

Using the ASBA facility incurs no charges for investors applying for IPOs.

ASBA IPO Timing

• ASBA IPO application can be initiated starting from 10 AM on the opening date of the issue.
• The ASBA cut-off time for application submission is at 5 PM on the closing date of the issue.
• Note that some banks may have earlier cut-off times, typically around 2 to 3 PM, especially on the final day.
• Investors should check the specific cut-off times set by their respective banks for ASBA IPO applications, particularly on the last day.

ASBA IPO Limit

• Investors are allowed to submit a maximum of 3 bids for an IPO.
• Each bank account can only have one ASBA IPO application submitted.
• Qualified Institutional Buyers (QIBs) and Non-Institutional Investors (NIIs) are unable to retract their bids once they have been submitted.
• QIBs and NIIs are not permitted to submit their bids at the cut-off price.
• Various banks may enforce their own specific cut-off times for ASBA IPO applications on the final day.

ASBA Rules for IPO

• Investors are required to hold an account at a bank that supports the ASBA facility.
• Active access to Net banking is necessary for ASBA online application submission.
• Possession of a PAN Number and a Demat account is compulsory for all IPO applications.

3rd party ASBA IPO application

Previously, select banks in India permitted third-party IPO applications, enabling investors to submit multiple IPO applications (up to 5) from a single bank account via Net banking. However, effective May 1, 2022, this option has been discontinued, and no banks in India currently offer third-party IPO application services.

ASBA vs UPI for IPO Applications