Sebi mandates UPI payment for public issue applications of debt securities

To streamline the application process for public issues of debt securities, markets regulator Sebi on Tuesday asked individual investors applying for amounts up to Rs 5 lakh through intermediaries to use only UPI to block funds.

Further, investors will continue to have the choice of availing other methods like applying through Self-Certified Syndicate Banks or the stock exchange platform for making applications, Sebi said in its circular.

These provisions will apply to public issues of debt securities starting from November 1.

The move is aimed at streamlining and aligning the process of applying in the public issue of debt securities, non-convertible redeemable preference shares, municipal debt securities and securitised debt instruments with that of the public issue of equity shares and convertibles.

"It has been decided that all individual investors applying in public issues of such securities through intermediaries (viz. syndicate members, registered stock brokers, registrar to an issue and transfer agent and depository participants), where the application amount is up to Rs 5 lakh, shall only use UPI for the purpose of blocking of funds," Sebi said.

Also, they are required to provide his/ her bank account linked UPI ID in the bid-cum-application form submitted with intermediaries, it added.

Last week, Sebi amended rules to streamline the process for public issuance of debt securities aimed at providing faster access to funds for such issuers.

Under the amended rules, Sebi reduced the period for seeking public comments on the draft offer documents from 7 working days to 1 day for issuers whose specified securities are already listed and 5 days for other issuers.

Also, the minimum subscription period has been cut from 3 working days to 2 working days. Further, in case of revision in the price band or yield, the bidding period disclosed in the offer documents, can be extended by one working day instead of three working days.