What are the basic requirements to apply in an IPO using the ASBA process?

Short Answer

ASBA or Application Supported by Blocked Amount is an alternative payment method to apply or bid for an IPO. However, it is currently available to only the Retail Individual Investors and you also need to fulfill certain requirements for the same.

Detailed Answer

ASBA Process is an alternative payment method that makes the listing and refund process efficient for the investors. But do you know what are the basic requirements to apply in an IPO using the ASBA process? If you are looking to find the answer for the same, then you are in the right place. Here in this article, we are going to discuss the basic requirements to apply in an IPO using the ASBA process. Let us get it started.

Basic Requirements to apply in an IPO using ASBA process

Below you can find some of the basic requirements to apply for an IPO through the ASBA payment method.

  1. Currency, retail individual investors can opt for the ASBA payment method to apply or bid for an IPO.
  1. The investor's bank should be a Self Certified Syndicate Bank, also known as SCSBs. The list containing the name of all the SCSBs are present in the official website of SEBI.
  1. Retail individual investors can bid at the cut-off price. Once they submit their bids they can't undo or modify them. Investors are only allowed to withdraw their application before the final allotment.
  1. The total bid amount or the applicable amount for an IPO will remain locked until the final allotment is complete. Investors cannot withdraw their money in this lock-in period.

Hence, ASBA is currently available for the retail individual investors. To apply or bid for an IPO through this alternative payment method requires you to have bank account with one of the Self Certified Syndicate Bank, also known as SCSBs.

ASBA to apply in IPO

So these are some of the basic requirements to apply in an IPO using the ASBA process. It is important to understand all these requirements well before making any bid by using the ASBA payment method. If you any other queries related to the ASBA payment method of IPO application, then feel free to get in touch with us and ask your doubts in the comment section down below.

Tagged With: asbaasba methodipoapply in ipo
Categories: IPO Basics
Ask your query and our expert community would be happy to help
Discussion (0)
Related FAQs

What is the ASBA Payment method for IPO?

ASBA stands for Applications Supported by Blocked Amount, which is an alternative payment method to apply for an IPO. Let's go through some more details on it.

How to apply IPO in Zerodha? Buy IPO Online

If you are a Zerodha customer, you can apply for IPO online through Zerodha Console (Zerodha Back-office). The process for applying an IPO process has been explained in detail above. Here are few other answers to important queries that you may want to learn.

I do not have a Demat account. Can I apply for an IPO?

Although there are ways such as ASBA facility of your bank that you can use to open an IPO without Demat Account. It is still advisable to have a Demat Account.

Do I have to pay any brokerage at the time of applying for an IPO?

No, the application process for an IPO can be availed with zero brokerage fees. Applying in an IPO is free of cost and you don't have to bear a fee.

Can I apply more than one IPO application in my name from different saving bank accounts in same bank or different banks?

Only one PAN card can be used for one application. No matter how many different savings account details you might utilize, if there is the same PAN number in more than two applications, then all of them would be revoked.

Can I apply in an IPO from my current bank account?

There is no provision for users to apply for an IPO through a current account. They would have to choose a savings account to get an IPO applciation processed further.

Can I apply in an IPO through multiple applications on same name?

No, a person cannot apply for a single IPO more than ones. There are strict rules and regulations followed in this matter. However, his/her family members can apply for the IPO under their name provided they have a demat account and PAN number.

Can a minor apply in IPO?

Have you ever wondered id a minor can apply for an IPO? Yes, a minor can apply for an IPO given that he/she has a PAN card and a Demat account.

What is the life cycle of an IPO? Process

An IPO or Initial Public Offering is where for the first time an earlier unlisted company sells new or existing securities and offers them to the public in the primary market.

Is it mandatory to have a Demat account to apply in an IPO?

Yes and no at the same time. Although you can apply for an IPO without a Demat Account in some cases, the allotted shares are tradable through a Demat Account, Thus, a Demat account is recommended for an IPO.