BANKING GENERAL KNOWLEDGE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Application supported by bank account
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Application supported by balance account
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Application supported by blocked account
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Application supported by blocked amount
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Detailed explanation-1: -What is “ASBA”? ASBA means “Application Supported by Blocked Amount”. ASBA is an application by an investor containing an authorization to Self Certified Syndicate Bank (SCSB) to block the application money in the bank account, for subscribing to an issue.
Detailed explanation-2: -Main Features of ASBA process. ASBA provides an alternative mode of payment in issues whereby the application money remains in the investor’s account till finalization of basis of allotment in the issue.
Detailed explanation-3: -Applications Supported by Blocked Amount (ASBA) is an additional Payment Mode introduced by India’s capital market regulator SEBI, with a view to make the existing public issue process more efficient. The ultimate aim is to reduce the time period between the Issue closure date and listing of shares.
Detailed explanation-4: -SEBI has mandated the ASBA facility for all investors to reduce the timeline for refund initiation. Under ASBA, investors continue to earn interest on the blocked amount during the IPO application process. Once the allotment completes, then your syndicate bank will remove the lien on the blocked amount.