Online ASBA FAQs

What is ASBA? A Simplified Guide for New Investors

New investors in the stock market may find themselves confused and intimidated by financial jargon, especially when it comes to ASBA. IPO Central is here to provide clarity and simplify things for investors. In this article, we will address frequently asked questions (FAQs) about online ASBA and its meaning, offering valuable insights for small investors in India. ASBA is one of the two primary methods for investing in IPOs, the other being the UPI payment option, which was introduced on January 1, 2019.

What is ASBA Full Form and ASBA Meaning?

ASBA full form is Application Supported by Blocked Amount. In simple words, ASBA meaning refers to an application mechanism that eliminates the need for refunds in the case of partial allotment and no allotment. ASBA allows the investor’s money to remain with the bank till the shares are allotted after the IPO. The funds are transferred after the allotment and to the extent of allotted shares. Seen another way, ASBA means less trouble for investors about the movement of application money.

Initially, the ASBA facility was not available for QIBs (Qualified Institutional Buyers) in IPOs, but this restriction was later lifted, and now SEBI permits investors from all categories to apply through ASBA.

Read Also: Best IPOs that Doubled Investors’ Money

Online ASBA Bank List

Not all banks offer the ASBA facility. To find the updated list of Self Certified Syndicate Banks (SCSBs) registered with SEBI to act as ASBA banks, investors can visit the SEBI website. As of July 2023, there are 53 banks on the ASBA bank list, including major private and public sector banks.

In June 2015, SEBI made it mandatory for all IPO applications to be made through the ASBA mechanism, starting from 1 January 2016.

How can Investors Make Offline ASBA Applications?

Investors can make offline ASBA applications by following these steps:

1. Obtain the offline ASBA form from the designated branches of banks acting as Self-Certified Syndicate Banks (SCSB).
2. Fill in the required details in the form, including the applicant’s name, PAN number, demat account number, bid quantity, bid price, and other relevant information.
3. Submit the completed offline ASBA form to their banking branch, instructing them to block the specified amount in their account.
4. The bank will then upload the application details to the bidding platform.
5. Investors must ensure the accuracy of the information filled in the offline ASBA form, as incorrect details may lead to the rejection of the application.
6. Alternatively, investors can also make online ASBA applications through the net banking interfaces provided by their banks.

Read Also: ASBA E Forms – Download IPO Application Form

Where do I get the ASBA Form and ASBA e-form?

You can obtain ASBA forms in both physical or offline formats from Self-Certified Syndicate Banks (SCSBs) and brokers. However, with the shift to online services, ASBA forms are also available on the Internet. ASBA e-forms can be downloaded from exchange websites and various bank websites as well.

How Many Applications I can Submit Through Net Banking from One Bank Account?

You can submit a maximum of five applications from one bank account, but this may vary depending on the specific conditions set by each bank. For instance, HDFC Bank does not allow IPO applications to be made on behalf of others, while Axis Bank does permit it.

Can I make an ASBA application from a current account?

Yes, you can make ASBA applications from a current account as well.

Can one apply from a sweep in/out savings bank account?

Yes, you can apply from a sweep-in/out savings bank account, but the application amount should not involve sweep-in funds. There must be a clear minimum cash balance equivalent to the application amount in the bank.

Can I apply in the name of family members & friends from my savings bank account?

Yes, you can apply on behalf of family members and friends from your savings bank account.

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

No, you cannot. If you do so, all your applications will be rejected. IPO applications are linked with PAN (Permanent Account Number), and thus, not more than one application per PAN is permitted.

Read Also: All-time largest IPOs in India at a glance

What are the unique IDs/fields in an application?

In an IPO application, the following three aspects must be unique and should not be repeated in any way:
1. Name of sole 1st applicant
2. Permanent Account Number (PAN)
3. DP ID + Client ID

In the case of a joint DP account, who will be considered the primary applicant?

Regarding a joint DP account, the IPO application will be considered as submitted under the first name in the joint account along with the corresponding details such as PAN and DP account.

Can I apply in the name of Minor or HUF?

Yes, you can apply in the name of a Minor or a Hindu Undivided Family (HUF). IPO applications can also be made from the demat account of a minor, provided that the account is operated by the minor’s guardians. However, it’s worth noting that only a few brokers open minor demat accounts, and the process is usually completely offline.

How many lots should I apply to get the maximum allocation?

To maximize allocation in an oversubscribed IPO, it is advisable to apply for only one lot, regardless of the number of lots you may be eligible for. In an IPO that is likely to be oversubscribed, the allotment is usually done through a lottery system, and each applicant is likely to receive only one lot.

However, in an IPO where the subscription is less than or equal to one time in the retail category, you may receive as many lots as you have applied for, up to the INR 200,000 limit. But keep in mind that this approach involves a higher risk, and you may end up losing a significant amount of money.

In summary, to be on the safer side, it is recommended to apply for one lot only in all cases.

Read Also: Highest IPO Subscription

When I should expect allotment and credit of shares in the demat account?

Shares are generally credited to your demat account within a week of the IPO’s closing date for subscription. Each IPO will have specific dates when the basis of allotment is made public. You can check our IPO discussion pages or IPO Subscription Status pages to get specific dates for individual issues.

What is the cut-off time for IPO applications?

The cut-off time for IPO applications can vary depending on the method of application. For online ASBA applications, the timelines range from 1 PM to 3 PM and may vary among different banks. Some banks may extend the time if there is a high rush of subscriptions. In physical applications through your broker, the cut-off time is typically 5 PM, and it may also be extendable.

How to check subscription figures and allotment status?

To check subscription figures and allotment status, you can refer to the BSE and NSE websites. For mainboard IPOs, the subscription figures are regularly updated on the “NSE bid details” and “BSE demand schedule” of the respective issue pages. IPO Central also provides real-time updates on our IPO Subscription Status page and IPO Allotment Status page.

What impact will the introduction of UPI have on the ASBA IPO process?

The introduction of UPI (Unified Payments Interface) for IPO applications has simplified the process for retail investors. From 1 January 2019, SEBI allowed retail investors to apply for IPOs through UPI, enabling them to use their mobile phones for application. However, this option does not impact the ASBA IPO process, which will continue to work in parallel as clarified by SEBI. We have a separate page about UPI for IPO investors which explains the whole process and its benefits.

Read Also: Best IPOs in 2024

Is the ASBA IPO application process also applicable to SME IPOs?

Yes, the ASBA IPO process is applicable in book-built as well as fixed price issues. This means SME IPOs are also supported by ASBA facilities. Investors can find ASBA options in rights issues as well.