SEBON plans to implement ASBA system by Shrawan 1; system ensures applicant’s money remains in bank account till shares allotment

To make the IPO process easier, managed, transparent, timely and cost effective, the Securities Board of Nepal (SEBON) is planning to bring Application Supported by Blocked Amount (ASBA) system. The working process needed for this system is being prepared by committee formed under the CEO of the board including stakeholders of Nepal Bankers Association, Nepal Merchant Bankers Association. Board plans to implement the ASBA system by Sharawan 1, 2073. ASBA System ensures that the applicant’s money remains in his/her bank account till the shares are allotted. Under this system, the IPO applicant needs to write an application to the bank to hold the certain amount of money in their respective account, after the bank holds that money, the bank will provide the proof. Then the applicant can apply in the IPO issue with that proof. After the allotment, the company will be handed over the amount equal to the shares allotted from the account of the applicant. After the implementation of ASBA system, the process of listing the shares in secondary market for trading will also be faster. The investors will also develop a habit of saving money. The secondary market will have a breakthrough after the implementation of the ASBA.