In an IPO what is ASBA payment method?

The Applications Supported By Blocked Amount (ASBA Process) was introduced in July 2008. It is an alternative payment method for IPO applications where the IPO bidding amounts remain in investors account but are blocked by the bank until the allotment.

This is an additional method of payment that is only for retail investors via participatory banks (SCSB).

This new payment option was added to speed up the refund process and reduce the turnaround time for IPO Stock Listing.

This type of payment option does not allow for refunds. Only the money required to allocate shares is taken from the investor's account. The remaining money can be used by the investor as soon as the required funds are withdrawn.

ASBA will help companies to list their shares without completing the refund process.

ICICIDirect Says

ASBA stands to represent "Applications Supported By Blocked Accounts". Bidding is done by blocking the account of investors to the amount of the bid amount. The account can then be debited at the time the allotment occurs. This facility is offered by ICICIDirect, in association with ICICI Bank Limited.

The bid amount is deducted from other payment options when an investor submits a bid to the stock exchanges. The ASBA process will debit your bank account until the successful allotment is made. The amount will be held in an investor's bank account until such time as it is allotted.
Once placed bids cannot be changed, but they may be withdrawn during issue open for subscription. Once the big issue is cancelled, the money becomes unlocked and accessible to the investor.

SEBI:

ASBA refers to an application that authorizes the bank to stop the application money from being deposited in the account. This is for the purpose of subscribing or purchasing an issue. ASBA is an application that allows investors to apply for a subscription. The applicant's application money will be deducted from the account if the application is approved or withdrawn.