To apply for an IPO online, you log in to your broker or bank’s IPO section, select the open issue, enter your quantity and bid price (or tick cut-off), submit the application, and then approve a UPI mandate in your payments app. Under ASBA, the money is only blocked in your account — never debited until shares are actually allotted.
That is the whole process in one breath, but each step hides a detail that decides whether your bid is valid: the 5 PM mandate deadline, the ₹2 lakh retail ceiling, what “cut-off” really commits you to, and how to pull out before the issue closes. If you want this foundation built properly rather than pieced together from app screens, a structured stock market course turns these one-time confusions into second nature. Let’s walk through it the way a first-time applicant actually experiences it.
Source: SEBI circular (April 2022), effective for IPOs opening on or after 1 May 2022; NPCI UPI-ASBA limit revision, December 2021.
What exactly happens when you apply for an IPO through ASBA?
ASBA stands for Application Supported by Blocked Amount, and it is the single idea that makes online IPO applications safe. When you apply, you are not sending money anywhere. Instead, your bank places a lien — a temporary hold — on the exact amount of your bid. The funds stay in your own savings account, continue to earn interest, and are completely untouchable by you only for that blocked portion.
If shares are allotted to you, the bank debits only the value of the shares you actually received and releases the rest. If you get no allotment, the full block is lifted and your balance is free again, usually within a working day or two of the basis of allotment being finalised. This is why experienced applicants never say they “paid” for an IPO — they blocked for it. You can read how that allotment itself is decided in our explainer on the core IPO terms every first-time investor must know.
Online, ASBA is delivered in two ways. The older route is through your bank’s net-banking IPO page, where the bank is both the fund-blocker and the application channel. The newer, more common retail route is through your stockbroker’s app, where the broker collects the bid and a UPI mandate does the blocking inside your payments app. Both end at the same place: a blocked amount and a bid sitting in the exchange’s order book. The flow below is the broker-plus-UPI version, because that is what most retail applicants use today.
The broker-plus-UPI application flow, start to finish.
How do you place an IPO bid using UPI, step by step?
Here is the full sequence as it plays out on a typical broker platform. None of it takes more than five minutes once you have done it once.
Step 1 — Open the issue. Go to the IPO or “Invest in IPO” section of your broker app. Open issues show the company name, the price band, the lot size, and the closing date. Pick the IPO you want and tap Apply.
Step 2 — Choose your lots and price. IPOs are applied for in lots, not single shares. One lot is the minimum, and for a mainboard IPO the minimum lot is sized so the application is roughly ₹14,000–₹15,000 at the top of the band. You can apply for one lot or several, as long as the total stays within your category limit. Enter the number of lots, then either type a price within the band or tick the cut-off option (more on that below).
Step 3 — Enter your UPI ID. Type the UPI ID linked to the bank account you want the money blocked in — for example, yourname@bankupi. Double-check it character by character. A single wrong letter is the most common reason a mandate never arrives.
Step 4 — Submit the bid. Review the quantity, price and amount, agree to the standard declarations, and submit. The broker forwards your bid to the exchange and triggers a collect request to your UPI ID.
Step 5 — Approve the mandate. Open your UPI app (the one that owns that UPI ID). You will see a pending mandate request showing the IPO name and the amount. Approve it with your UPI PIN. This authorises the block — it does not spend the money. Your bank then blocks the amount and your application is live.
The deadline that catches people out: the UPI mandate must be approved by 5 PM on the final day of the issue. A bid with an unapproved mandate at that cut-off is simply not counted, however early you submitted it. Because servers slow under last-hour load, applying on day one or two and approving the mandate immediately is the safest habit. For the bigger picture of how the whole issue moves from filing to listing, see our walkthrough of the IPO process in India from DRHP filing to listing day.
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Most mainboard IPOs are book-built, which means the company offers a price band — say ₹205 to ₹216 — and the final issue price is discovered from demand. When you apply you get a choice: name a specific price inside the band, or tick cut-off. Bidding at cut-off means you agree to accept whatever final price is set, up to the top of the band.
For a retail applicant, cut-off is almost always the sensible default. You block the amount at the ceiling price; if the final price is discovered lower, the difference is unblocked automatically. If you instead name a price below the final cut-off, your bid falls out of the money and wins no allotment at all — you have effectively bid yourself out of the IPO. The comparison below lays out the trade-off.
| What matters | Cut-off price bid | Specific (fixed) price bid |
|---|---|---|
| Chance of being “in the money” | ✓ Always eligible at the final price | ✗ Rejected if your price is below cut-off |
| Amount blocked | At the top of the band; excess unblocked later | At the price you named |
| Who it suits | Retail applicants who just want allotment | Rarely used by retail; a deliberate view on price |
Based on standard book-building rules for Indian IPOs. Educational comparison, not a recommendation.
A related choice is the channel. Applying through your bank’s net-banking ASBA page keeps everything with one institution but can feel clunky; applying through your broker with a UPI mandate is faster and is what most people now use. The money ends up blocked either way — pick whichever interface you trust yourself to complete before the deadline.
Can you change or cancel an IPO bid after applying?
Yes — within limits, and only before the issue closes. As a retail investor in a mainboard IPO you can usually revise your bid up or down, or withdraw it entirely, right up to the issue closing date. From the day after closing, the application is locked and can no longer be modified or cancelled.
The one trap worth burning into memory: cancelling the UPI mandate is not the same as cancelling the bid. Revoking the mandate in your payments app may release your blocked money, but the bid can still be sitting in the exchange’s order book. To genuinely cancel, you delete the application inside the broker or bank IPO order book; that sends a delete request to the exchange and removes the bid. Do that first, then let the block lapse. Any released funds typically return to your account within two to five working days.
Two category notes. Non-institutional and qualified-institutional bidders face stricter rules — they generally cannot withdraw or reduce their bids once placed. And SME IPOs are different again: under the revised framework, cancellation is not permitted for any investor category, so an SME application is a firmer commitment than a mainboard one. If SME issues are new to you, our guide to what an SME IPO is and how applying to it differs is the right next read.
Common mistakes when applying for an IPO online
Almost every rejected or failed retail application traces back to one of these avoidable errors:
- Not approving the mandate in time. Submitting the bid is only half the job. If the UPI mandate is still pending at 5 PM on the closing day, the bid is void.
- Mistyping the UPI ID. One wrong character and the collect request never reaches your app. Verify it before submitting.
- Insufficient balance. The full bid amount must be free in the account for the bank to block it. A balance short by even a little means the mandate fails.
- Multiple applications on one PAN. Two applications under the same PAN for the same IPO get both rejected. One PAN, one application, is the rule.
- Naming a price below the likely cut-off. A fixed low bid can leave you out of allotment entirely. Cut-off avoids this.
- Waiting for the last hour. Heavy traffic near the deadline is real; a request that doesn’t process in time simply won’t count.
What to do next
Applying for an IPO online is genuinely simple once the vocabulary clicks: open the issue, pick lots, bid at cut-off, approve the UPI mandate before 5 PM, and let ASBA keep your money in your own account until allotment. The real skill is not the form — it is judging which issue deserves your application in the first place, reading the prospectus, and understanding what the stock is likely to do on listing day. That is where structured learning pays for itself. You can see how a listing actually unfolds in our piece on what happens on IPO listing day, and build the full foundation through a guided course.
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How much money is needed to apply for an IPO?
At least one lot, which for a mainboard IPO is usually around ₹14,000–₹15,000 at the top of the price band. Under the retail category you can apply for up to ₹2,00,000 in total, and that amount is only blocked, not spent, until allotment.
What is the difference between ASBA and UPI in an IPO?
ASBA is the principle — your application is supported by an amount blocked in your bank account. UPI is one way to authorise that block when you apply through a broker. Bank net-banking applications use ASBA without UPI; broker applications use a UPI mandate to set up the same block.
When is the money debited from my account?
Only after shares are allotted to you. Until then the amount is merely blocked and keeps earning interest. If you receive a partial or nil allotment, the unused portion is unblocked, usually within a working day or two of the allotment being finalised.
Why did my IPO application fail even though I had the balance?
The most common reasons are a mandate left unapproved past the 5 PM deadline, a mistyped UPI ID so the collect request never arrived, or a duplicate application on the same PAN. Check your UPI app for a pending or lapsed mandate first.
Can I apply for an IPO for someone else from my account?
No. Each application must use the applicant’s own PAN, demat account and bank account. You cannot combine family members under one application, and multiple applications on one PAN for the same issue are rejected. Open a separate demat and apply individually.
Disclaimer: This article is for educational purposes only and does not constitute investment advice. Markets carry risk — please do your own research or consult a qualified financial professional before investing. NIFM provides training and exam preparation; certification exams conducted by regulatory or professional bodies are administered by those bodies independently.
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