UPI mandate and ASBA: how the money for an IPO application is blocked and released

Money for an IPO application is not paid upfront. It stays in the applicant's bank account and is blocked (Application Supported by Blocked Amount, or ASBA). Only the amount for shares actually allotted is debited; the rest is released.

Through UPI

• Individual investors can apply through UPI for up to ₹5 lakh.
• The broker or app sends the bid to the exchange; the bank then sends a mandate request to the UPI app.
• The mandate must be accepted by 5 pm on the last day of bidding. A bid whose mandate is not accepted in time is not valid.
• The blocked amount is released by T+2 for any part not allotted.

Through net banking

Banks that are Self-Certified Syndicate Banks (the SEBI list is linked from each issue's page on the exchange) accept ASBA applications directly in net banking, for any amount allowed to the category.