Online brokerage firm Paytm Money has launched a new feature to allow investors to pre-book IPO allotments. This will allow customers to bid for IPOs before the actual IPO opening in the markets.
The ‘Pre-IPO Open application’ feature has been designed to target young investors. It will give a push to the participation of retail investors.
Investors can now place an IPO order 24×7 on days when the “pre-Open IPO Application” feature is enabled. It means that a user can now place an IPO order which is recorded on Paytm Money’s system. It will be sent to the exchange for processing whenever the IPO opens for subscription. Paytm Money will notify the user about the application status one the bid is placed.
“Interest in IPOs has surged over the last couple of months, and we have seen cases where users have missed out from applying because of issues like tight schedules during market hours, and demand led processing delays in the markets,” Varun Sridhar, CEO of Paytm Money, said.
“We wanted to make the lives of our users easier and ensure that they don’t miss out on good opportunities,” he added.
As per the SEBI, retail investors can buy shares worth Rs 2 lakh through a public offer. The conventional process to bid for an IPO is to apply when the stock exchange is open. The bidding for IPO shares at the stock exchange is open from 10 am to 5 pm when the IPO is open for the public subscription. However, those bidding through banks are not allowed to bid till 5 pm on the last day of the issue. The time differs from bank to bank.
Food ordering platform Zomato is the first IPO on Paytm Money that will be launched with the new feature.
Paytm Money’s new feature will curtail the congestion in networks and provide seamless experience to investors and increase their participation. It will also reduce the load on exchanges and payment gateways.