How-to IPO refund UPI ASBA lien Blocked funds SCSB escalation Zerodha IPO

How to fix an IPO refund not received on Zerodha

From WebNotes, a public knowledge base. Last updated . Reading time ~12 min. Level: Beginner.

An IPO refund not received on Zerodha almost always means an ASBA lien that the bank has not yet lifted, not money that has gone missing. Under UPI ASBA , your bid amount was never debited; the bank placed a hold on it. After a non-allotment , the registrar instructs the bank to release that hold, and your available balance is restored. When the “refund” seems not to have arrived, the lien is usually still in place at the bank, and the fix is to track it and, if it stalls, escalate through Zerodha, then the bank, then SEBI. This guide sets out the timeline, why a stall happens, and the exact escalation order.

It is written for the investor whose money is still showing as blocked after an IPO they were not allotted. The first and most important reframing is that you are not waiting for a credit; you are waiting for a hold to be lifted, so an incoming refund entry will never appear, only a release. The mechanics are common to every UPI-ASBA broker, because the unblock is performed by the self-certified syndicate bank on the registrar’s instruction, not by Zerodha .

Conflict-of-interest disclosure. This guide is published by the WebNotes Editorial Team for informational purposes and is written independently. WebNotes operates a Zerodha account-opening referral programme, disclosed on the pages that carry the referral link; this guide does not carry it and earns no referral commission from the procedure described here.

Step-by-step procedure

The numbered infobox at the top gives the sequence. The sections below expand each step, the reason behind it, and the reference numbers to keep ready at each escalation.

1. Confirm you were not allotted

Before chasing a refund, confirm the outcome that triggers one. A full unblock is due only on a Not Allotted status. Check three places: Kite under Bids, where the bid card shows the allotment status; the registrar’s portal with your PAN and application number; and the BSE or NSE allotment portal. If the status is Allotted, your block was converted to a debit for the allotted shares, which is correct and not a refund failure; only any surplus over the allotment consideration is released. The detailed checking routes are in how to check IPO allotment on Zerodha and on the registrar’s site .

2. Understand the refund is an unblock, not a credit

This step prevents the most common misreading. In UPI ASBA the money never left your bank account; the bank placed a lien on it, reducing your available balance while leaving the book balance unchanged. A non-allotment “refund” is the bank removing that lien, which restores your available balance. There is no incoming credit transaction, so refreshing your statement for a money-in entry is the wrong thing to watch. Watch the available balance and the lien-release or mandate-cancellation entry instead.

3. Wait through the normal release window

The release runs to the SEBI T+3 listing cycle. The basis of allotment is finalised on T+1, the registrar instructs the sponsor bank within hours, and the lien clears in your account by T+1 evening or T+2 morning for non-allottees. SEBI’s rules require UPI IPO refunds to be initiated within four working days of the issue’s close. So allow until the end of T+2, the working day before listing, before treating the block as stuck. Acting earlier usually means the automated release simply has not run yet, and a manual escalation is premature. The full sequence is in what happens after an IPO bid is placed and the tracking detail in how to release blocked IPO funds after non-allotment .

4. Check your bank app for the release entry

Open your bank’s app or NetBanking and check two things: whether the available balance has risen by the blocked amount, and whether the transaction history shows a release. The entry label varies by bank, IPO mandate cancellation, lien released, UPI block reversal, ASBA unblock, or similar. If both the balance is restored and an entry appears, the unblock is complete and nothing more is needed. If the balance is still short, note the mandate reference and move to escalation. Do not try to cancel the mandate manually in your UPI app; the cancellation is the bank’s to perform on the registrar’s instruction, and a manual attempt can confuse the processing.

5. Raise a Zerodha ticket if the block persists

If the lien is still held past T+2 with a confirmed Not Allotted status, raise a ticket at support.zerodha.com under IPO and the allotment or refund category, using how to create a ticket with Zerodha . Include your Zerodha client ID, the issue name, the application or bid reference, the mandate reference number, the registrar’s Not Allotted status with its source, and the current bank available balance showing the lien is still held. Zerodha’s IPO support can escalate to the sponsor bank on your behalf, since the broker forwarded the original bid and holds the bid trail.

6. Escalate to your bank or SCSB

The sponsor bank, an SCSB named in the offer document, holds the lien and is responsible for lifting it. If Zerodha cannot resolve it within a couple of working days, contact the bank’s UPI grievance desk directly through its customer-care number or in-app chat. Provide the mandate reference number from your UPI app and cite the basis-of-allotment publication date and the registrar’s Not Allotted status. A stall at this stage is usually a smaller or cooperative bank taking 24 to 72 hours to process the release, or a case where the bank lifts the lien only at the UPI mandate’s expiry rather than on the registrar’s instruction; naming the mandate reference and the allotment date helps the desk locate and clear it.

7. Use the UPI dispute portal and the registrar

For a stall that is specifically a UPI mandate not being revoked, raise the case on the NPCI UPI dispute redressal mechanism, reachable from within most UPI apps as a complaint or dispute option, quoting the mandate reference. In parallel, contact the registrar named in the offer document, KFin or Link Intime in most issues, quoting your PAN, application number, the basis-of-allotment date, and your Not Allotted status, since the registrar is the party that instructs the bank to unblock. Working both the UPI rail and the registrar widens the chance of the instruction being re-sent and acted on.

8. Escalate to SEBI SCORES as a last resort

If the broker, the bank and the registrar have not resolved the unblock within the issue’s stated refund timeline, file a complaint on SEBI’s SCORES portal at scores.sebi.gov.in. SEBI SCORES is the statutory investor grievance system; a complaint is routed to the relevant intermediary with a mandatory acknowledgement and response timeline. Attach the full reference trail: client ID, application and mandate references, the registrar status, the dates of your earlier escalations, and the bank statement showing the lien. This is the backstop the regulation provides, and the four-working-day refund-initiation rule and the issuer’s penalty for delay are the standards SCORES will hold the intermediary to. The broader escalation map is in the investor grievance escalation matrix .

Why a release stalls

Most stalls are operational, not a lost refund. The registrar’s instruction is prompt after T+1, but the bank’s processing can lag: a smaller private or cooperative bank can take an extra 24 to 72 hours to lift the lien, and some banks release the hold only when the UPI mandate reaches its expiry, which can be 10 to 15 days from approval. A second cause is a withdrawal scenario: if the issuer withdraws the issue after the bid window closes, all mandates are released, but the timeline can run a little longer, T+3 to T+5. A third is a mismatch between the bid reference in Kite and the mandate reference in the UPI app when multiple IPOs were bid in one day, which makes the right lien hard to identify; mapping each mandate reference to each bid resolves it.

Allotted, not allotted, and partial: which release applies

The release you should expect depends on the outcome. On a full non-allotment, the entire block is released. On a full allotment, the block is debited for the allotment consideration and there is no refund, only any surplus where you bid at cut-off and the issue priced below the upper band. On a partial allotment, where you applied for more than you were allotted, the consideration is debited and the surplus on the unallotted portion is released, both typically on T+1. Reading a partial-allotment debit as a missing refund is a common error; check the allotment quantity against your bid before escalating.

When to worry and when not to

Within the T+1 to T+2 window, a still-held block is normal and needs no action; the release is automated. Past T+2 with a clear Not Allotted status, it is worth a ticket. Past the issue’s four-working-day refund window, it is a genuine grievance and the SCSB and SCORES routes apply. Anchoring your response to the day count, rather than to anxiety on the morning after the issue closes, keeps the escalation proportionate and avoids manual mandate-cancellation attempts that slow the bank’s own processing.

See also

External references

References

  1. SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018, Regulation 62 on basis of allotment, refunds and release of blocked amounts.
  2. SEBI circular SEBI/HO/CFD/TPD1/CIR/P/2023/140 dated 9 August 2023, T+3 listing timeline and release schedule.
  3. SEBI, FAQs on UPI in the public issue process, July 2019 (refunds to be initiated within four working days of issue close; lien release for non-allottees).
  4. NPCI UPI 2.0 one-time mandate (block) specification and UPI dispute redressal mechanism.

WebNotes Editorial Team prepares factual how-to guides based on publicly available regulatory documents and broker disclosures. WebNotes is not affiliated with Zerodha Broking Limited or any registrar or sponsor bank. Refund timelines are subject to change; verify current requirements at support.zerodha.com and scores.sebi.gov.in before acting.

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The WebNotes Editorial Team covers Indian capital markets, payments infrastructure and retail investor procedures. Every article is fact-checked against primary sources, principally SEBI circulars and master directions, NPCI specifications and the official support documentation published by the intermediary in question. Drafts go through a second-pair-of-eyes review and a separate compliance read before publication, and revisions are tracked against the SEBI and NPCI rule changes referenced in the methodology section.

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