UPI or net banking (ASBA) for an IPO: which should you use?
Both ways of applying work on the same principle: the bid amount is blocked in your bank account and debited only if you are allotted shares. The differences are in the steps, the limits and the risk of a missed approval.
At a glance
UPI: apply in a broker app, then approve a mandate in your UPI app. Bids up to ₹5 lakh. The bid is valid only once you approve the mandate, by 5 PM on the closing day.
Net banking (ASBA): apply in your bank's net banking. The amount is blocked straight away, with no second approval step. No ₹5 lakh limit, so it is the way for large HNI bids.
Why UPI is more popular
It is quick, works from a broker app you already use, and needs no bank login. It is also how most retail bids are placed.
Where UPI goes wrong
The mandate request can arrive late or not at all, especially on the last day. If it is not approved in time the bid does not count. You can also approve a request for the wrong amount or the wrong IPO by mistake, so check the details before entering the PIN.
Where net banking is better
There is no mandate step to miss, so nothing depends on a notification arriving. It also allows bids above ₹5 lakh. The trade-offs: you need to know your demat details (DP ID and client ID), the bank's screens can be clumsy, and banks have their own cut-off on the last day, which can be earlier than 5 PM.
What is the same
The money stays in your account, only the amount for allotted shares is debited, and the rest is released after the allotment. The applicant's PAN, demat account and bank account must match whichever way you apply, and one PAN gets one application per category.
Related guides
- The IPO UPI mandate, explained
- Applying for an IPO through net banking (ASBA)
- How to apply for an IPO in India
More on applying for an ipo
- Can family members apply for the same IPO separately?
- What the cut-off price means in an IPO
- How to modify or cancel an IPO bid
- When to apply for an IPO
- Pre-applying for an IPO
- Borrowing to apply for an IPO
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Information, not investment advice. GMP is an unofficial grey-market indicator; figures come from public sources (InvestorGain) and may be late or wrong. Not registered with or affiliated to SEBI, the exchanges, the registrars or InvestorGain.