How to apply for an IPO with UPI or ASBA

An IPO is an initial public offer. A company sells shares to the public for the first time. You bid, and the bank blocks the amount in your own account. Money moves only if shares are allotted. That block is ASBA, Application Supported by Blocked Amount. UPI is one way to give the instruction. Your bank’s net banking is the other.

This is the first note in a short series. It covers who can bid, the demat account, lots, the cut-off price, the retail cap of ₹2,00,000, the UPI mandate, bank ASBA, and listing in 3 working days. It does not quote a grey market premium. An off-exchange price is not the issue price, and SEBI does not publish one. The sample later is an illustration, not an issue that is open.

Who can apply

A retail individual investor applies or bids for shares worth not more than ₹2,00,000. That is the definition. It is not a test of your income.

Anyone who is not retail, and not a qualified institutional buyer, is a non-institutional investor. Institutions include mutual funds, banks, and insurers. For a personal bid, the line that matters is ₹2,00,000.

An NRI bid up to ₹2,00,000 can count as retail. Above that, it is non-institutional. The offer document says whether that issue is open to NRIs and to minors.

You need a PAN, a demat account in the same name, and a bank account in your own name. The PAN on the form, on the demat account, and on the bank account must match. A mismatch is invalid. A third-party UPI ID or bank account is not accepted. A joint holder of your own account is not the same as a stranger’s account.

One bank account carries one application in a public issue. One person submits one form. On that form you may bid at up to 3 prices. Those prices are one bid. A second form, or a duplicate with the same application number, can be rejected. The registrar can also treat the same PAN, or the same DP ID and client ID, as a second bid.

On the profitability route, at least 35% of the net public offer is for retail, at least 15% for non-institutional investors, and not more than 50% for institutions. A compulsory book-built issue needs at least 75% for institutions, or the money is refunded. Not more than 15% goes to non-institutional investors, and not more than 10% to retail. A fixed-price issue starts with at least 50% for retail. The offer document prints the split. There is no discretion inside a category. If there are fewer than 1,000 prospective allottees, the company cannot allot.

You need a demat account

Shares in an IPO are issued only in demat, under section 29 of the Companies Act, 2013. There is no paper certificate. The DP ID and the client ID must match the depository, or the form is rejected. An account suspended for credit is inactive, and the bid can be rejected. Update the address and the bank details before you apply. The nomination already on the demat account covers the shares.

The bid has to be a whole number of lots. Employees, and retail shareholders in a reservation, may also bid in the net public offer. Those two bids are not a forbidden second application. In an employee reservation the bid cannot exceed ₹5,00,000. The first allotment there is capped at ₹2,00,000. More is allotted only if that reservation is not fully taken, and the total still cannot exceed ₹5,00,000.

Lots, the retail cap and the cut-off price

The company sets a minimum lot so the smallest application falls between ₹10,000 and ₹15,000. Further bids are whole lots. The floor, the cap, and the lot are advertised at least 2 working days before a book-built IPO opens.

Cut-off means you will take the shares at the price discovered inside the band. Only a retail investor can choose it, and so can an employee or a retail shareholder in a reservation. An institution or a non-institutional investor who ticks cut-off is rejected.

The block is made at the cap. If the discovered price is lower, the difference is released. A specific price below the discovered price can fail. A cut-off bid does not fail for that reason.

A retail bid, after any discount, must stay within ₹2,00,000. If a revision pushes it over, the bid may move to the non-institutional category and lose a retail discount. If that oversized bid was at cut-off, it can be rejected. Check the amount at the cap before you add a lot.

Each retail allotment, and each non-institutional allotment, is at least one minimum lot if shares in that category are available. Anything left after that is allotted in proportion. Nobody at the company hands a larger lot to a favoured name.

A book-built issue stays open for 3 to 7 working days. If the band is revised, bidding is extended by 3 working days. A fixed-price issue stays open for 3 to 10 working days. You can revise the quantity or the price until the close. On UPI, a change needs a fresh mandate. If you never approve it, the old mandate remains.

Apply with a UPI mandate

UPI here is not a transfer on the day you tap. You approve a mandate. The bank blocks the amount. It is released or debited after allotment.

From issues opening on or after 1 May 2022, an individual who applies through a syndicate member, an eligible broker, a depository participant, or a registrar, for up to ₹5,00,000, uses UPI and puts the UPI ID on the form. That is circular SEBI/HO/CFD/DIL2/CIR/P/2022/45 of 5 April 2022. NPCI’s NPCI/UPI/OC No. 127/2021-22 of 9 December 2021 had raised this IPO block from ₹2,00,000 to ₹5,00,000.

SEBI’s later FAQ says UPI is not the only path. ASBA is what is mandatory. UPI is the block used when an individual applies through those intermediaries, up to ₹5,00,000. A bid between ₹2,00,000 and ₹5,00,000 is non-institutional, and an individual can still use UPI for it. Above ₹5,00,000, use the bank’s ASBA.

1. Apply with your own UPI ID, on an account at a bank that can act as an issuer bank. Choose the lots and a price, or cut-off.
2. Accept the mandate with your UPI PIN. On the closing day the deadline is 5 pm on T.
3. The bank blocks the amount at the cap. The rest of the account stays usable. An SMS confirms that the bid was registered, on the closing day or the next working day.
4. After allotment, only the allotted amount is debited. If you get nothing, the whole block is released.

A retail investor can withdraw until the close, through the same intermediary, and should revoke the mandate. Do not approve a fresh block after you have cancelled. If a revoke fails, start it again. The UPI ID has to be yours. A family member’s ID is a third-party application and is not valid for allotment.

Apply with ASBA through your bank

If your bank is a self-certified syndicate bank, and you hold a savings account there, you can submit ASBA at a designated branch or on net banking. There is no UPI mandate. The bank blocks the amount. Use this path when the bid is above ₹5,00,000. You can also use it for a smaller bid. Only the application amount is blocked. The rest of the balance stays available. NSE and BSE both describe this route.

Keep the acknowledgement. A syndicate counterfoil with the signature, date, and stamp is proof the bid was taken for upload. If a correct form is rejected, go back to that bank or intermediary. A reply is expected within 15 days. After that, the merchant banker and SEBI’s SCORES are the next step. A retail investor can withdraw up to the close with a signed request that quotes the application number. A non-retail bidder cannot withdraw.

From the close to the T+3 listing

Circular SEBI/HO/CFD/TPD1/CIR/P/2023/140 of 9 August 2023 cut listing from six working days to three. It was voluntary for issues opening on or after 1 September 2023, and mandatory from 1 December 2023. T is the closing date. Trading starts on T+3. A weekend does not count as one of the three. The annexure has more than one clock. Mixing them up is how a bid is missed.

A paper form closes earlier than an online form. Use the timetable in that issue’s advertisement.

The registrar matches the PAN on the demat account with the PAN on the bank account. Rejections are finished before 6 pm on T+1. The exchange approves the basis before 9 pm on T+1. UPI unblocking is completed before 4 pm on T+2. Shares are credited before trading starts. If the release is late, compensation is counted from T+3. Complain first to the bank, then to the intermediary, and then through SCORES.

A sale after listing is a market trade. The tax on it sits on the capital gains calculator and in the capital gains guide. The allotment itself is not that tax. A monthly purchase, instead of one bid, is a SIP. The SIP calculator and the CAGR calculator do not place an IPO application.

Mistakes that reject a bid

Most rejected bids are a wrong detail, not a view on the company.

• The UPI ID or the bank account belongs to someone else.
• The PAN on the form, the demat account, and the bank account do not match.
• The DP ID or the client ID is wrong.
• The demat account is suspended for credit.
• The mandate was never accepted, or a revised mandate was ignored and the old block remained.
• Cut-off was used on a bid above ₹2,00,000 at the cap. Cut-off is for retail, and for employees or retail shareholders in a reservation.
• A second form was sent, or two copies share an application number. Up to 3 prices on one form are allowed.
• The bid is not a whole number of lots.
• The applicant expected the money to leave on day one. It is blocked, and debited only for shares that are allotted.
• An off-exchange premium was treated as the bid. The price has to sit in the published band, or at cut-off for a retail bidder. This page does not print a grey market premium.

NSE and BSE publish demand by category while the book is open. That is not a promise of allotment.

Figures were checked on 30 October 2026 against SEBI’s May 2025 primary-market FAQ, the general information document, the UPI circular of 5 April 2022, the listing circular of 9 August 2023, and the ASBA pages of NSE and BSE. The sample lot is arithmetic, not a live issue.