Refund Timeline for Non-Allotted IPO Applications
Introduction
When an investor does not receive shares in an IPO, the application amount is not lost. Instead, the blocked or paid funds are refunded or unblocked within a defined timeline as per SEBI and exchange guidelines.
How IPO Application Money Is Handled
Most IPOs in India follow the ASBA (Application Supported by Blocked Amount) mechanism, where funds remain blocked in the investor’s bank account instead of being debited upfront.
If shares are not allotted, the blocked amount is released automatically without any manual intervention from the investor.
Standard Refund / Unblocking Timeline
As per the current IPO process, the refund or unblocking of funds for non-allotted applications generally follows this timeline:
- T Day: IPO closes for subscription
- T+1 Day: Basis of allotment is finalized by the registrar
- T+2 Day: Funds are unblocked or refund instructions are initiated
- T+3 Day: Shares are credited to successful applicants and refunds reflect for others
ASBA vs Non-ASBA Refunds
The refund experience depends on whether the IPO was applied through ASBA or a non-ASBA mechanism.
- ASBA Applications: Funds are unblocked in the same bank account used for applying.
- Non-ASBA Applications: Refunds are credited back to the investor’s bank account via electronic transfer.
Partial Allotment Cases
If an investor receives a partial allotment, only the amount corresponding to the allotted shares is debited.
The remaining blocked amount is released automatically along with refunds for non-allotted applicants.
What If Refund Is Delayed?
In rare cases, refunds or unblocking may be delayed due to technical or banking issues.
- Delay in basis of allotment finalization
- Bank processing or UPI mandate issues
- Incorrect bank or PAN details provided during application
Steps to Take If Funds Are Still Blocked
- Check allotment status on the registrar’s official website
- Wait at least one working day after allotment finalization
- Contact your bank or broker if funds remain blocked beyond the expected timeline
Important Points for Investors
- Refunds are automatic and do not require any request from the investor
- Interest is not paid for the blocked period
- Exact timelines may vary slightly depending on the IPO and registrar
Disclaimer
Refund timelines are indicative and based on standard IPO processes. Actual timelines may vary depending on registrar, bank, or exchange procedures. Investors should rely on official registrar communications for final confirmation.