What is ASBA facility?

Application Supported by Blocked Amount (ASBA) is an application made by an investor for the subscription of an Initial Public Offer (IPO) and Follow-on Public Offer (FPO). The form contains an authorization to Self-Certified Syndicate Bank (SCSB) to block funds available in the applicant’s Savings Bank Account or Current Account (other than Overdraft or loan accounts), for subscribing to an Issue. The amount to be blocked must be to the extent of application money, till finalization of allotment in the issue or till withdrawal/ failure of issue, or till withdrawal/ rejection of the application, as the case may be.

When an investor applies for IPO/FPO through ASBA, he cannot use the blocked amount for any purpose. However, funds blocked in the account will continue to earn interest during the application processing period, if held in an interest-bearing account. Bank will mark a lien on the deposit account of the investor to the extent of the application money. The lien will be removed immediately after the finalization of the basis of allotment. If a bid is successful, the deposit account will be debited and the allotted shares will be transferred by the Company to the applicant’s Demat account.

Eligibility:

The ASBA facility is available to Indian residents who have a valid PAN number along with a Demat account and trading account. At the time of applying through ASBA, the investor must have an adequate balance in his account to be blocked. The investor cannot revise the bid after applying through ASBA.

How to submit an ASBA application online?

An investor who has an internet banking facility (INB) on their deposit account, with transaction rights can bid through the ASBA facility online.  

Click on the link named “IPO Application” displayed on the menu.   

Select one of the IPOs you want to apply for and mention up to 3 bids.

Enter your depository details.   Place and confirm your Order.

You would then be required to accept the “Terms & Conditions” before submitting the bid.

How to submit an Offline ASBA Application?

 Download the ASBA form from the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) websites. Fill in the required details and submit the form at the Self-certified Syndicate Banks along with the photocopy of the required identity proof. The bank will send the application details to the stock exchange and block the stipulated bid amount in your bank account.    You can check the application status on both BSE and NSE websites.