SEBI New Rules; Sebi’s new plan will stop fraud in the stock market
Broker’s commission will also not be charged before share transaction. For example, ASBA’s services are availed in IPOs. Similarly, now ASBA will also be implemented in the stock market and after this it is expected that the fraud in the market will be curbed.
What is ASBA?
An application supported by blocked amount (ASBA) is used in India for Initial Public Offering (IPO) or Follow-on Public Offering (FPO), wherein the amount is deducted from the bank account of the investor only after the allotment of shares. In this rule, the first investor’s amount is blocked, which is deducted after each transaction. Now SEBI will apply this rule in stock market also and the rule will be changed from January 1, 2024.
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The Securities Exchange Board of India or SEBI said that through ASBA i.e. Blocked Amount Supported Application, people investing in stock market can get protection from fraud. After the implementation of ASBA, the money is deducted only till the process of purchase and sale of shares is completed. Investors have the option of withdrawing the amount they want to block directly, multiple times from the account. Share investors’ money is first sent to a clearing corporation, where the money can be withdrawn only on the purchase and sale of shares. Interestingly, this new facility can also be availed on the basis of UPI.
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Investors have options
Under ASBA your amount is blocked, which is deducted from your account only after the share transaction is completed. But whether you want to avail this facility or not will all depend on the investment rates and brokers. But investors who have multiple broking accounts can use non-UPI facility for some accounts and UPI facility for other accounts. After the implementation of this new regulation by SEBI, fraud in the stock market can be reduced to a large extent.
