ASBA Full Form | What Does ASBA Stand for?

ASBA: Application Supported by Blocked Amount

ASBA Full Form

ASBA full form stands for Application Supported by Blocked Amount. The Application Withholding Fund (ASBA) is a process developed by the Indian stock market regulator SEBI to apply for an IPO. In ASBA, an IPO is not debited from the applicant’s account until they are allotted shares.

Brief Explanation

The ASBA process helps retail individual investors bid through cut-offs, with only one option being to apply through Self-Certified Syndicate Banks (SCSBs), which include investors’ bank accounts. SCSBs are banks that meet the requirements of SEBI.

SCSB will accept the application, confirm the application, refund the amount to the extent of the bid payment amount, upload the details in the NSE web-based bid system, once the allocation basis is removed, they will become irrevocable and the number of shares issued will transfer to the issuer.

Categories of investors

  • Retail investors
  • Eligible institutional buyers
  • Non-institutional investors

Advantages

  • The investor does not have to pay the application money by check but has to block his bank account to the extent of the application money, thus earning interest on the application money.
  • The investor does not have to worry about refunds, as when a proportionate amount of the securities allocated in ASBA is withdrawn from the bank account when its application is finally allocated on the basis of allotment.
  • The customer can withdraw the amendment/bid before the expiry of the issue in an agreed format from the bank.

What Is The Full Form Of ASBA?

ASBA full form stands for Application Supported by Blocked Amount. It is a process developed by the Indian stock market regulator SEBI to apply for an IPO. In ASBA, an IPO is not debited from the applicant’s account until they are allotted shares.

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