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ASBA facility save cumbersome of IPO refund

Monday, January 17, 2011 | | |

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Investing in IPO is proved best way to make profit as well as great way to maximise your capital in Indian stock market. My one of friend is master in IPO. He invest his money in IPO only. He have that much knowledge of IPO. After listing he will try sell them as quickly as possible and grab profit. He give thanks to ASBA facility. He admitted that due to ASBA if can make fast roll over of his money.

What is ASBA payment facility for IPO?

ASBA stands for " Application supported by blocked amount", what is it mean ?
ASBA is payment method for IPO beside conventional method of payment. ASBA introduced in 2008. Amount of application money required for IPO is blocked by bank. It means bank kept amount of IPO in his custody on behalf of company. Once IPO listed and share allot to individual investor. Then money will refund by bank who does not get share in IPO else those money in to concern company.

Like old method of payment you need not to wait for money if you does not get share. This facility not available all banks. It only available to SCSB banks. You can check NSE website.

You can not withdraw money once you applied for IPO. Investor have to account in SCSB. Investor can withdraw application of IPO before closing date. My friend use the account of ICICIDIRECT.

Ask to your broker for ASBA facility. It will save cumbersome of refund process.

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