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SEBI increased UPI bid limit for retail investors in IPOs

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The retail investors will be able to bid up to Rs 5 lakh in IPOs on or after May 1, 2022, as per the SEBI said on April 05. The UPI bid limit is revised from Rs 2 lakh to Rs 5 lakh for IPO investment.

Read the SEBI notice for “Revision of UPI limits public Issue of Equity Shares and convertibles“. The points are given below:

  1. SEBI vide Circular SEBI/HO/CFD/DIL2/CIR/P/2018/138 dated November 01, 2018, introduced the use of Unified Payment Interface as an additional payment mechanism with Application Supported by Blocked Amount (ASBA) for Retail Individual Investors, and the same was mandated w.e.f. July 01, 2019, vide SEBICircular SEBI/HO/CFD/DIL2/CIR/P/2019/76 dated June 28, 2019, for applications by Retail Individual Investors submitted through Intermediaries
  2. NPCI vide circular reference no. NPCI/UPI/OC No. 127/ 2021-22 dated December 09, 2021, inter alia, has enhanced the per transaction limit in UPI from Rs. 2 lakh to Rs. 5 lakh for UPI based Application Supported by Blocked Amount (ASBA) in Initial Public Offers(IPOs).
  3. NPCI has reviewed systemic readiness required at various intermediaries to facilitate the processing of applications with increased UPI limit and confirmed that as of March 30, 2022, more than 80% of SCSBs/Sponsor Banks/UPI Apps have conducted the system changes and have complied with the NPCI provisions.
  4. Accordingly, it has been decided that all Individual Investors applying in Public Issues where the application amount is up to 5 Lakhs shall use UPI and shall also provide their UPI ID in the bid-cum-application form submitted with any of the entities mentioned herein below:
      1. A syndicate member
      2. A stockbroker registered with a recognized stock exchange (and whose name is mentioned on the website of the stock exchange as eligible for this activity) (‘broker’)
      3. A depository participant (‘DP’) (whose name is mentioned on the website of the stock exchange as eligible for this activity)
      4. A registrar to an issue and share transfer agent (‘RTA’) (whose name is mentioned on the website of the stock exchange as eligible for this activity)
  5. This circular shall come into force for Public Issues opening on or after May 01, 2022, and is being issued in exercise of the powers under section 11 read with section 11A of the Securities and Exchange Board of India Act, 1992.
  6. This circular is available on the SEBI website at www.sebi.gov.in under the categories “Legal Framework” and “Issues and Listing”.
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