UPI or Unified Payment Interface is a system that incorporates various banking features under one hood. The features can be inter-bank money transfers and merchant payments. Being a digital platform, UPI has made merchant transactions simpler and financial transactions easier. The UPI is a real-time payment application that uses the Immediate Payment Service structure designed by the National Payments Corporation of India.
UPI for retail IPO application
The Securities Exchange Board of India has made it mandatory for retail investors to apply for Initial Public Offering through an intermediary like stockbrokers, depository participants (DPs) and registrars & transfer agents to use the UPI mechanism. The limit for IPO application is twolakhper transaction on UPI.
Requisites for UPI
- A smartphone with a mobile number linked to the bank. UPI is accessible on all platforms through Android / iOS.
- It is followed by a Bank Account that facilitates UPI.
- An activeDebit Card is a must to set the UPI PIN. If there are multiple banks, users can select a primary bank for the UPI application.
How to create a UPI ID
The UPI ID gets created by registering with one of the UPI enabled mobile applications using your Bank Account details. BHIM, GPay, PhonePe, PayTM are a few apps that provide the facilities.
Steps to apply for an IPO through UPI
- A subscriber needs to access an ongoing IPO after logging into an intermediary’s website or an app.
- Select an ongoing IPO, fill in the bid details, submit the UPI ID as a payment option, and submit the form.
- After the form submission, the subscriber receives the block funds mandate request.
- The subscriber then accepts this mandate and enters the UPI pin to block the same.
- After this, the funds get blocked.
- On full allotment, the amount gets debited, and the shares get transferred to Demat Account
- On partial allotment, the partial fund gets unblocked, and partial allotment shares get allotted.
- On no allotment, funds get unblocked after the expiry date or the end of the mandate date.
Benefits of applying for an IPO through UPI
The mandate for fund blocked helps in the real-time submission of applications. One need not wait for the bank debit to happen. The stock exchanges notify by sending an SMS when the bid gets successfully placed. Fund transfer occurs instantly, and a notification is sent to the subscriber. It is completely hassle-free as one need not physically move or stand in queues to submit the IPO application.
Disclaimer – ICICI Securities Ltd. ( I-Sec). Registered office of I-Sec is at ICICI Securities Ltd. – ICICI Venture House, Appasaheb Marathe Marg, Prabhadevi, Mumbai – 400 025, India, Tel No : 022 – 6807 7100. Please note, IPO related services are not Exchange traded products and I-Sec is acting as a distributor to solicit these products. All disputes with respect to the distribution activity, would not have access to Exchange investor redressal forum or Arbitration mechanism. The contents herein above shall not be considered as an invitation or persuasion to trade or invest. I-Sec and affiliates accept no liabilities for any loss or damage of any kind arising out of any actions taken in reliance thereon. Investments in securities market are subject to market risks, read all the related documents carefully before investing. The contents herein mentioned are solely for informational and educational purpose.