UPI now must for public issue applications of debt securities
The Securities and Exchange Board of India (SEBI) has issued a directive, mandating the use of Unified Payments Interface (UPI) for individual investors applying for public issues of debt securities. This rule, effective from November 1, applies to applications of up to ₹5 lakh made through intermediaries. The move is aimed at streamlining the application process, and aligning it with that of equity shares and convertibles.
Directive on UPI usage for fund blocking
SEBI has clarified that individual investors applying through intermediaries such as registered stock brokers, syndicate members, registrar to an issue and transfer agent, or depository participants must use UPI for fund blocking. Investors are also required to provide their bank account-linked UPI ID in the bid-cum-application form, submitted with intermediaries.
Recent amendments to public issuance process
The UPI mandate is part of SEBI's broader effort to streamline the public issuance process for debt securities. Recently, the regulator amended rules to expedite access to funds for issuers. The period for seeking public comments on draft offer documents was reduced from seven working days, to one day for issuers with already listed specified securities, and five days for other issuers.
SEBI shortens subscription and bidding periods
SEBI has also shortened the minimum subscription period from three working days to two. In instances of revision in the price band or yield, the bidding period disclosed in offer documents can be extended by one working day instead of three.
