The Securities and Exchange Board of India vide its notification dated 23rd November 2020 has decided to introduce an option to investors to apply in public issues of debt securities through the app / web interface of Stock Exchange(s) with a facility to block funds through Unified Payments Interface mechanism for application value upto Rs. 2 Lac.
The following are the new entities/mechanisms which are part of the public issue using UPI.
- The National Payments Corporation of India which is an umbrella organization for all retail payments in India. It has been set up with the guidance and support of the Reserve Bank of India and Indian Banks Association.
- UPI is an instant payment system developed by the NPCI. It enables merging several banking features, seamless fund routing & merchant payments into one hood.
Further the details of investor viz. PAN, DP ID / Client ID, entered on the Stock Exchange platform at the time of bidding, shall be validated by the Stock Exchange/s with the Depositories on real time basis and it shall formulate and disclose the operational procedure for applying through the app / web based interface developed by them in order to apply in public issue on their websites.
The new framework would be applicable to a public issue of debt securities which opens on or after January 1, 2021.
