What is “ASBA”?
ASBA means “Application Supported
by Blocked Amount”. ASBA is an application
containing an authorization to block the
application money in the bank account,
for subscribing to an issue. If an investor
is applying through ASBA, his application
money shall be debited from the bank account
only if his/her application is selected
for allotment after the basis of allotment
is finalized, or the issue is with drawn/failed.
Detailed procedure of applying in IPO
through ASBA.
Under ASBA facility, investors can apply
in any public/ rights issues by using their
bank account.
Investor submits the ASBA form (available
at the designated branches of the banks
acting as Self Certified Syndicate
Banks (SCSBs)) after filling the details
like name of the applicant, PAN, demat
account number, bid quantity, bid price
and other relevant details, to their banking
branch by giving an instruction to
block the amount in their account. In turn,
the bank will upload the details of the
application in the bidding platform. Investors
shall ensure that the details that are
filled in the ASBA form are correct otherwise
the form is liable to be rejected.
Who can apply through ASBA facility?
SEBI has been specifying the investors
who can apply through ASBA. In public issues
w.e.f. May 1, 2010 all the investors can
apply through ASBA.
In rights issues, all shareholders of
the company as on record date are permitted
to use ASBA for making applications provided
he/she/it:
- Is holding shares in dematerialized
form and has applied for entitlements
or additional shares in the issue in
dematerialised form;
- Has not renounced its entitlements
in full or in part;
- Is not a renouncee;
- Who is applying through blocking of
funds in a bank account with the Self
Certified Syndicate Bank.
What advantage an investor has in applying
through ASBA vis-à-vis applying
through an Application with a cheque?
Applying through ASBA facility has the
following advantages:
- The investor need not pay the application
money by cheque rather the investor
submits ASBA which accompanies an authorization
to block the bank account to the extent
of the application money.
- The investor
does not have to bother about refunds,
as in ASBA only that much money to the
extent required for allotment of securities,
is taken from the bank account only
when his
- application is selected for allotment
after the basis of allotment is finalized.
- The
investor continues to earn interest
on the application money as the same
remains in the bank account, which is
not the case in other modes of payment.
- The
application form is simpler.
- The investor
deals with the known intermediary i.e.
its own bank.
Is it mandatory for investors
eligible for ASBA, to apply through ASBA
only?
No, it is not mandatory. An investor, who is eligible for ASBA, has the option
of making application through ASBA or through the existing facility of applying
with cheque.
Can I make application through ASBA
facility in all issues?
Yes, you can make application through ASBA facility in all the issues i.e. public
and rights.
Where should I submit my Application
Supported
by
Blocked
Amount (ASBA)? How shall I know which
bank
and which branch of that bank is the designated
branch for accepting ASBA applications?
List
of Self
Certified Syndicate Banks (SCSBs) and their
designed
branches i.e. branches where ASBA application
form can be submitted, is available on the
websites of BSE (www.bseindia.com)
and NSE (www.nseindia.com) and on the website
of SEBI (www.sebi.gov.in). The list
of SCSB
would
also be given in the ASBA application form.
What
is Self
certified Syndicate Bank (SCSB)?
SCSB
is a
bank
which
is recognized as a bank capable of providing
ASBA services to its customers. Names of
such banks would appear in the list available
on the website of SEBI. [Also see answer
to question (6)]
Can I submit ASBA in any of the
banks
specified
in the list of SCSBs?
No, ASBA
can be submitted to the SCSB with which the
investor is holding the bank account.
How many applications can be
made
from
a bank
account?
Five
(5) applications can be made from a bank
account per issue.
Am I required to submit ASBA
only
physically?
No, you
can either fill up the physical ASBA form
available with SCSB and submit the same to
the SCSB or apply electronically/online through
the internet banking facility (if provided
by your SCSB). Investor is requested to check
the form carefully. In case of public issue,
the application form for ASBA will be different
from the existing application form for public
issues. The application forms will be available
with designated branches of SCSB. In case
of rights issue, there will
not be a separate form for ASBA. The investor
has to apply by selecting ASBA option in
Part A of the Composite Application Form.
Can I withdraw my ASBA bids?
If
yes,
how?
Yes,
you can withdraw ASBA bids. During the bidding
period you can approach the same bank to
which you had submitted the ASBA and request
for withdrawal through a duly signed letter
citing your application number, TRS number,
if any. After the bid closure period, you
may send your withdrawal request to the Registrars
before the finalization of basis of allotment,
who will cancel your bid and instruct SCSB
to unblock the application money in the bank
account after the finalization of basis of
allotment.
Who should I approach if I find
that
I
had
given
all correct details in the ASBA form, but
application has been rejected stating wrong
data?
You have to approach the concerned SCSB for any complaints regarding your ASBA
applications. SCSB is required to give reply within 15 days. In case, you are
not satisfied, you may write to SEBI thereafter at the following address:
Investor Grievance Cell,
Office of Investor Assistance and Education,
Securities
and Exchange Board of India
Plot
No.C4‐A,'G' Block, Bandra Kurla Complex,
Bandra(East),
Mumbai:
400051
Tel:
+91‐22‐26449000 / 40459000
Fax:
+91‐22‐26449016‐20 / 40459016‐20
Whether my bank account will
be
blocked
or only
the amount
to the extent of application money is
blocked?
No. the
entire
bank
account will not be blocked. Only the amount
to the extent of application money authorized
in the ASBA will be blocked in the bank account.
The balance money, if any, in the account
can still be used for other purposes.
If I withdraw my bid made through
ASBA,
will
the bank
account
be unblocked immediately?
If the
withdrawal is made during the bidding period,
the SCSB deletes the bid and unblocks the
application money in the bank account. If
the withdrawal is made after the bid closure
date, the SCSB will unblock the application
money only after getting appropriate instruction
from the Registrar, which is after the finalization
of basis of allotment in the issue.
Do I necessarily need to have
a DP
account
with
the SCSB
where I intend to submit the ASBA application?
No. Investors
need
not necessarily have their DP account with
the SCSB, where they are submitting the ASBA
form.
Can I submit my ASBA to a broker
as
is
being done in the present issue process applying
through
cheque?
You are
required to submit ASBA to the SCSBs only.
Can I apply in an issue through
ASBA
facility
and through “normal
existing
system
of payment through
cheque” in
an issue?
No. An
investor
can apply
either through ASBA or through existing system
of payment through cheque. If an applicant
applies through both, ASBA as well as non‐ASBA then both
the applications having the same PAN, will
be treated as multiple application and hence
will be rejected.
Are the bids submitted through
ASBA
and
uploaded
in
the
electronic
bidding
system of the stock exchange, in case of
public issue through book building, reflect
in the demand graphs displayed in the website
of stock exchanges?
Yes. The bids
received
through
ASBA mode will also be reflected in the demand
graphs displayed in the website of stock
exchanges.
Who is responsible for errors
in the
data
uploaded
in
the
electronic bidding system in
case
of public
issue?
In case
there
is an
error
in the data furnished in the application
form submitted by investor, the investor
shall be responsible. In case there is an
error
by SCSB in entering the data in the electronic
bidding system of the stock exchanges, the
SCSB shall be responsible.
Will I get the acknowledgement
of
receipt
for applications
submitted
through ASBA from the SCSB?
Yes.
The SCSB shall give a counterfoil as an acknowledgement
at the time of submission of ASBA and also
the order number, generated at the time of
uploading the application details, if sought
by the investors in case of need.
Will there be any different
treatment
in allotment
for ASBA
and Non –ASBA
forms?
No.
ASBA forms will be treated similar to the
non‐ASBA
forms
while finalizing the basis of allotment.
What happens when the issue
fails/is
withdrawn?
In case
the issue fails/withdrawn the SCSB shall
unblock the application money from the bank
accounts upon receiving instructions from
the Registrar.
In case of any complaints regarding
ASBA
application
whom can I approach?
In case
of any
complaints
the investor shall approach the bank, where
the application form was submitted or the
Registrars to the issue.
In case a person is having bank
account
with
a
branch,
for example, at Kolkata can he submit IPO
application through ASBA at a branch of the
bank in Guwahati.
Yes,
this can be done provided that your bank
have core banking facility and the ASBA form
is submitted at a branch which is identified
as designated branch by the bank.
Is there a better chance of
allotment
if
one
applies
in IPO through ASBA?
The
chance of getting allotment is same for all
the applicants whether application is made
through ASBA or non‐ASBA. ASBA is a simple,
easy and smart way of applying in public
issues. There are many advantages of applying
through ASBA like money does not go out of
investors’ account, no hassle of refund,
investor
keep earning interest on the blocked amount
as banks have started paying interest on
daily basis w.e.f April 1, 2010 and it gives
better opportunity for utilization of money.
What if the SCSB is not the
applicant’s banker?
ASBA
forms can be submitted only at the SCSBs.
In case investor does not have an account
with any of the SCSBs, then he can not make
use of the ASBA. |
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