Mumbai (PTI): Market regulator SEBI on Tuesday approved in-principle an alternative mode of payment for public and rights issues, which will enable applicants to keep money in banks till allotment of shares and thus eliminate the need for refunds.

"The board approved, in-principle, the concept of marking lien on bank account as an alternative mode of payment in public/rights issues," SEBI said after its board meeting here.

The new method of payment, it said, will enable the application money to remain in the bank account of the applicant till allotment of the shares.

This will eliminate the process of giving refunds by companies to the applicants in case of non-allotment of shares, SEBI said, adding that the modalities would be announced later.

Presently, applicants have to wait for quite some time to get refunds on non-allotment of shares.

SEBI also decided to raise the minimum networth criteria for portfolio managers from Rs 50 lakh to Rs 2 crore.