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What is ASBA (Application Supported by Blocked Amount)?

A SEBI-mandated mechanism that blocks the IPO application money in your bank account rather than debiting it immediately.

ASBA stands for Application Supported by Blocked Amount. It is an application mechanism mandated by SEBI (Securities and Exchange Board of India) for all IPO applications.

How ASBA Works

When you apply for an IPO using ASBA, the application amount is not immediately deducted from your bank account. Instead, the bank simply "blocks" the required amount. You continue to earn interest on that blocked amount.

  • If you get an allotment: The exact amount for the allotted shares is debited from your account, and the remaining block is released.
  • If you don't get an allotment: The entire blocked amount is simply unblocked, usually within hours of the allotment finalization.

This eliminated the historical nightmare of waiting weeks for refund checks to arrive in the mail.