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Application Supported By Blocked Amounts (ASBA)
June 07 , 2012

Earlier, if you applied to an Initial Public Offer (IPO), you would need to pay the full application amount to the Escrow Account specified in the form. After the 2-3 weeks of processing time, the allotment would be made, and any excess amount would be credited back to your Bank account. In Applications Supported by Blocked Amounts (ASBA), you only authorise blocking the application amount in your own Bank account while applying. When allotment is done, only the money corresponding to the allotted shares gets debited from your account.

This is a small investor friendly norm that the regulator SEBI has introduced, so that you continue to earn interest on your money in the interim. Whether you can avail this facility or not, depends on your Bank. Most mainstream Banks in their city branches have this facility – such Banks are called Self Certified Syndicate Banks (SCSB).

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