Public Issues ASBA application shall be processed only after the application monies are blocked
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- Last Updated on 1 June, 2022
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Circular no. SEBI/HO/CFD/DIL2/P/CIR/2022/75, Dated: 30.05.2022
The SEBI vide circular no. SEBI/HO/CFD/DIL2/CIR/P/2018/138 dated 01.11.2018 introduced the use of Unified Payment Interface (UPI) as an additional payment mechanism with Application Supported by Blocked Amount (ASBA) for Retail Individual Investors. The same was mandated w.e.f 01.07.2019 vide circular no. dated 28.06.2019 for applications by Retail Individual Investors (RIIs) submitted through Intermediaries.
The SEBI in order to streamline the bidding process and to ensure the development of the securities market has reviewed the processing of ASBA applications in the Public Issues by market intermediaries and Self Certified Syndicate Banks (SCSBs). The SEBI has notified that the ASBA applications in Public Issues shall be processed only after the application monies are blocked in the investor’s bank accounts.
Accordingly, all intermediaries/market infrastructure institutions are advised to ensure that appropriate systematic and procedural arrangements are made within 3 months from the date of issuance of the circular. Further, Stock Exchanges shall accept the ASBA applications in their electronic book building platform only with a mandatory confirmation on the application monies blocked.
The circular shall be applicable for public issues opening on or after Sep 01, 2022.
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