ASBA has reduced refund related investor complaints: Sebi

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Application supported by blocked amount (ASBA) has brought down refund related investor complaints, said CB Bhave, Chairman, Securities and Exchange Board of India (Sebi), told CNBC-TV18. About 20% of investors use ASBA now.

According to Bhave, the number of bank branches offering ASBA is not enough. He added that sub-brokers have reach to investors and hence can promote ASBA.

Under the ASBA facility, an investor subscribes to an initial public offer but the money lies in the applicants account until his bid is accepted. Thus, he does not lose out on interest.

The regulator has been trying to simplify and speed up the IPO process. It has reduced the time taken to listing to 12 days from the earlier 22 days.

Bhave said guidelines for mutual fund distributors are on the anvil. In August last year, Sebi banned fund houses from charging investors entry loads, which was used to remunerate distributors. It has been trying to make transparent the remuneration paid to distributors, thus making the whole process more transparent and ushering in the much needed accountability.