IPO refund and unblocking: when is your money released?
Updated 26 October 2026 · 5 min read
When you apply for an IPO in India, your money is not sent anywhere. It is blocked in your own bank account under the ASBA system, and it stays there until allotment is decided. If you get no shares, the block is lifted by T+2, two working days after the issue closes. If you get shares, only the amount for those shares is debited and the rest is released at the same time. So an IPO "refund" is really an unblocking.
This guide explains how the block works for UPI and net-banking applications, what to expect on each day, how partial allotment is handled, and the steps to follow if your money is still blocked after T+2.
How ASBA blocking works
ASBA stands for Application Supported by Blocked Amount. When you approve a UPI mandate, or apply through your bank's net banking, the bank places a lien on the bid amount. The money stays in your account and normally continues to earn savings interest, but you cannot spend or transfer it. Your available balance drops by the blocked amount, which is why many people think it has been debited.
- UPI applications: the block is created when you approve the mandate with your UPI PIN. The mandate section of your UPI app shows it as active or approved.
- Net-banking ASBA: the block is created immediately when you submit the application in net banking. It appears as a lien or hold on the account.
- If you cancel your bid while the issue is open, the block is released, usually within a day or so.
The timeline
| Day | What happens to your money |
|---|---|
| Bid day | Amount blocked when the mandate is approved or the ASBA form is submitted |
| T (closing day) | Still blocked |
| T+1 | Allotment finalised; still blocked while the bank receives instructions |
| T+2 | Debit for allotted shares; release of everything else |
| T+3 | Shares list; blocked money should already be free |
T = issue closing day, in working days. Weekends and exchange holidays are not counted.
In practice many investors see the release on the evening of T+1 or during T+2. Your UPI app may show the mandate as "revoked", "completed" or "executed" depending on whether money was debited.
Partial allotment: what is debited
Here is an illustration. Say you applied in the small NII category for 14 lots of 142 shares at ₹105, a total of ₹2,08,740, and the draw gives you one lot. The bank debits ₹14,910 for those 142 shares and releases the remaining ₹1,93,830. In the retail category the same applies: a bid for several lots that receives one lot is charged for one lot only. You never pay for shares you did not receive.
If you bid at cut-off and the final price was fixed below the top of the band, the debit is at the final price and the difference is also released.
If your money is still blocked after T+2
- Check the allotment status with the registrar using your PAN. If shares were allotted, the block will turn into a debit, not a release.
- Look in your UPI app's mandate or autopay section, and in your bank statement for a lien entry. Note the IPO name, amount and date.
- Wait until the end of T+2 or the morning of T+3; some banks process releases in batches.
- Contact your bank (the ASBA bank holding the block) with the IPO name, application number and PAN, and ask for the lien to be removed.
- If you applied through a broker with UPI, raise a ticket with the broker too; they can check the status with the exchange.
- If the issue is not resolved, write to the registrar of the issue, whose contact details are in the RHP and on its website.
- As a last step, file a complaint on SEBI SCORES, attaching your application details and the replies you received.
Compensation for delayed unblocking
SEBI rules put the responsibility for timely unblocking on the intermediaries handling your application, mainly the bank holding the block. If the release is delayed beyond the prescribed time, those rules provide for the investor to be compensated by the intermediary responsible. The amount and method are set out in SEBI circulars and can change, so ask your bank or broker which provision applies, and mention it in your complaint if the delay continues.
Mistakes that cause confusion
- Reading a lower available balance as a debit. Check the statement: a lien is not a debit.
- Expecting the money on T+1. The release normally comes on T+2.
- Not counting the weekend. An issue closing on Friday has T+1 on Monday and T+2 on Tuesday.
- Moving money out of the account before closing day in the hope of freeing it. The block remains until the issue process releases it.
- Approving two mandates by mistake. A second approved bid from the same PAN can make both invalid; both blocks are released, but you lose the chance of allotment.
If you track an IPO under My IPOs, the dates timeline shows when the release is due, so you know when to start asking questions.
Frequently asked questions
How long does an IPO refund take?
There is no refund to wait for, because the money was only blocked. The block is normally released by T+2, two working days after the issue closes.
Do I earn interest while my money is blocked?
Usually yes. The money stays in your savings account, so the bank normally continues to pay interest on it. Check your bank's terms.
I got one lot out of five. Why was only part of my money released?
The bank debits the amount for the shares you were allotted and releases the rest. You pay only for the one lot you received.
Whom should I contact first if my money is not unblocked?
Your bank, because it holds the block. Give the IPO name, application number and PAN. If that does not work, contact the broker, then the registrar, and finally file a SCORES complaint.
Does a cancelled bid release the money immediately?
Cancelling during the issue period triggers a release, but it can take a day or so for the bank to process it.