With big ticket IPOs hitting the street in the last two months, the UPI IPO platform has also witnessed robust adoption by investors.
According to data with the National Payments Corporation of India, over 73 lakh mandates were created in December, slightly lower than the 76 lakh mandates created in November.
However, this was much higher than that in October when a mere 11.4 lakh mandates were created on UPI IPO.
Mandate execution was also robust with 7.97 lakh mandates executed in December and 12.39 lakh in November.
Mandate creation means a transaction where the customer has created a successful block of amount in the bank account for an IPO application, while mandate execution relates only to IPO applications for which shares have been allotted.
November and December 2021 saw many companies coming to the bourses, including Zomato, Nykaa, Star Health, Data Patterns and MapMyIndia.
The UPI IPO facility allows investors to use their UPI ID as a mode of payment while subscribing to an initial public offering on the National Stock Exchange and BSE.
Investors have to tell their broker to use this payment option while filling the IPO application. The limit for IPO application through this channel is Rs 2 lakh per transaction.
Adoption and usage of the mode is expected to increase further with the upcoming LIC IPO.Further, the Reserve Bank of India has also proposed to enhance the transaction limit for payments throughUPIfor IPO applications to ₹5 lakh.
By December-end 2021, there were 47 remitter banks live on the UPI IPO facility. State Bank of India, HDFC Bank and ICICI Bank registered the largest volume for mandate creation as well as execution.
As many as 26 UPI apps are also live with the IPO facility.