ASBA for individuals (FAQs)
1. Is issuer required to provide ASBA facility for all issues?
Yes, the issuer is required to provide ASBA mode in all public issues/rights issue where not more than one payment option is given to the investors.
For example, if in any public / rights issue provides payment option as shown below shall not be allowed in ASBA facility.
|Amount Payable per equity
||Payment Method -I @ Applicable to all categories of shareholders except NRIs/FIIs
||Payment Method -II @ Applicable to all categories of shareholders including NRIs/FIIs
|(Fig in Rs.)
|First and final call
2. Does issuer has discretion to appoint SCSBs?
Issuer is deemed to have entered into an agreement with SCSBs who have been recognized as such by SEBI. As such, issuer has no discretion in choosing SCSBs.
3. What is expected to be ensured by the issuer?
Issuer shall, in consultation with Lead managers, ensure the following:
- Registrar to issue appointed by the issuer has capability to comply with the procedures laid down by SEBI for ASBA and shall treat ASBA and Non‐ASBA application at par.
- Sufficient number of physical ASBA application forms are printed and made available to all SCSBs.
- ASBA and Non‐ASBA shall be treated at par and the selling commission shall be paid accordingly to Syndicate Members or SCSBs, as the case may be, for collecting ASBA.
4. I am a Bank and want to make a public issue through a book building. Can I act as a SCSB in the issue?
Yes, you can act as a SCSB.
5. How can a bank become an SCSB?
A bank which is registered with SEBI as a Banker to issue in terms of SEBI (Bankers to an Issue) Regulations can become SCSB subject to the following requirements:
- Submit a certification to SEBI confirming that it is capable of discharging the responsibilities of a SCSB.
- SEBI to include name of the bank in the list of SCSBs displayed on the website of SEBI.
- The bank shall act as SCSB w.e.f. from date of as shall be specified in the list. For full details, please refer to the Circular No. SEBI/CFD/DIL/ASBA/1/2009/30/12 dated December 30, 2009 issued by SEBI to all registered bankers to issues.
6. How a bank which has become a SCSB, get connectivity with electronic bidding system of Stock exchanges?
The bank can contact the stock exchange offering electronic bidding system, which is presently being offered by Bombay Stock Exchange and National Stock Exchange to get connectivity and ensure that systems are in place to get the connectivity and secured transfer of data from banks to Stock Exchanges.
7. Can a Cooperative Bank, become an SCSB?
Any bank which is registered as bankers to an issue registered with SEBI in terms of SEBI (Bankers to an Issue) Regulations can become SCSB subject to satisfying other conditions specified by SEBI.
8. Can SCSB accept ASBA application electronically also?
Yes, SCSBs can provide a facility of submitting ASBA through the internet banking facility to the investors electronically where the provision to block the account is provided.
9. If a SCSB intends to provide only electronic ASBA, is it possible?
Yes, it is possible; however sufficient information to this effect should be made available to all the clients by the SCSB.
10. What is a SCSB expected to do after receipt the ASBA?
After receipt of ASBA, SCSB is expected to ensure (i) blocking of funds in the bank accounts mentioned in ASBA and (ii) uploading the details given in ASBA received physically or electronically, in the electronic bidding system of Stock Exchange(s).
11. Is SCSB required to validate/verify details given in ASBA?
No, SCSB is not required to validate the details given in ASBA application. SCSB is however required to follow the normal diligence required in banking transactions.
12. Can SCSB outsource the task of collection of ASBA applications and uploading of the application details?
SCSB is wholly responsible for any omission and commission done during the process and the bids which are uploaded in the electronic bidding system of Stock Exchanges has to be done through SCSB code.
13. Can SCSB transfer the blocked application money to a separate account instead of blocking the money in the same account?
Yes, a SCSB can do it if it serves the purpose of blocking till allotment is finalized and interest, if any, is earned by investor till the amount is transferred to the issuer account.
14. How does a SCSB get the file formats for uploading of bids?
In case of public/rights issues, SCSB may approach the Stock Exchange offering electronic bidding system. They will inform SCSB about the file formats. It may be noted that only after the mock trial run done with Stock Exchanges and Registrar; the bank will be in position to submit a certification to SEBI as mentioned in the reply to Question 5 above.
15. What data/details a SCSB is required to send to the Stock exchanges and Registrar?
SCSB is required to upload details like Application number, DP ID, Client ID, Bid Quantity, PAN from ASBA form.
In case of an Electronic ASBA, the ASBA investor himself/herself shall fill in all the above mentioned details in the online application system of the bank, except the application number which shall be system generated. The SCSB shall thereafter upload all the above mentioned details in the electronic bidding system provided by the Stock Exchange(s).
Further, if there is any withdrawal during the bidding period, SCSB shall delete the same for each record individually or through batch upload.
SCSB is also required to send the following details to Registrar:
The SCSB shall send the following aggregate information to the Registrar to the Issue after closure of the bidding period:
(i) Total number of ASBAs uploaded by the SCSB
(ii) Total number of shares and total amount blocked against the uploaded ASBAs.
For full details, please refer the Circular No. SEBI/CFD/DIL/ASBA/1/2009/30/12 dated December 30, 2009 issued to Bankers to issue, by SEBI.
16. Is it mandatory that only Designated Branch (DB) which accepts the ASBA has to upload the bids in the Electronic Bidding System?
No, it is not mandatory. Depending upon the internal comfort and system of each bank, it is possible for DBs to collect applications, block the amount and then transfer to Controlling Branch (CB) for centralized uploading or DBs to only collect applications and upload directly. It may please be noted that as far as investors are concerned, they would be informed about addresses of DBs where they can submit ASBAs. Thereafter, the procedure to be followed is totally internal to SCSB and it is possible that DBs which accept ASBA, only upload the bids or the DB will transfer the applications to the CB for uploading the bids, subject to time lines specified by SEBI being followed.
17. Will the investor get a confirmation from the Stock Exchanges on upload of bids in case of public issues?
Yes, Stock Exchange electronic bidding system will provide for generation of order number which can confirm the uploading of bids. These order number as well as application number, will help SCSB as well as the investors in tracking their application. However, in the case of Rights issues, for the time being, the application data is flowing directly from the SCSB to the Registrar and not routed through the stock exchange electronic web enabled interface. Hence, the application data is sent directly to the concerned registrars, who will confirm the receipt of application to SCSBs.
18. What records a SCSB is required to keep in regard to ASBA facility?
Electronic record of ASBA uploaded, account/amount blocked and unblocked. ASBA physical forms may be retained for a period of 6 months with SCSB for redressing complaints if any, of ASBA investor and thereafter the same may be sent to the issuer.
As regards electronic ASBA, SCSB need not take print out or submit such print out to issuer or registrar.
19. What is expected to be done by the SCSB, in case the investor withdraws his ASBA bid during the bidding period or after the bid closure in case of public issues?
ASBA investor interested in withdrawing his/her application during the bidding process will approach the SCSB and request for deletion of the bids. SCSB will do the necessary to delete the bids from electronic bidding system and unblock the bank account. However, once the bidding period is over, ASBA investor will write to the Registrar giving all the relevant details like ASBA Number, order number, if available, DP ID, Client ID and PAN etc based on which Registrar will remove the bid from the electronic bid file. However, the bank account will be unblocked by SCSB only after the receipt of appropriate instruction from the Registrar after finalization of basis of allotment in the issue.
20. What is the role and responsibility of the Controlling Branch (CB) of SCSB?
CB is expected to act as a central point of co‐ordination for various intermediaries with SCSB i.e. Stock Exchanges, Registrar and Merchant Bankers.
21. Does SCSB have the discretion to select issues where it will provide service of ASBA?
No. Once a bank is included in the list of SCSBs maintained by SEBI, it shall act as SCSB for all issues to come where ASBA is applicable.
22. How can the Registrar reconcile the data on ASBA Bids in case of public issues since the Registrar does not get the application in case of ASBA?
Registrar will do the reconciliation based on data received from Stock Exchanges and the aggregate data received from SCSBs after closure of the issue regarding total number ofbids uploaded, the total number of shares applied for in such uploaded bids and total amount blocked for such uploaded bids.
23. How many applications can be made from a bank account?
SCSBs have to ensure that not more than Five (5) applications can be made from a bank account per issue.