IRDAI Launches Bima-ASBA to Make Insurance Premium Payment Easier via UPI

Current Context: The Insurance Regulatory and Development Authority of India (IRDAI) launched Bima-ASBA (Applications Supported by Blocked Amount) on February 18, 2025.

• This new payment mechanism allows policyholders to use the Unified Payments Interface (UPI) to make insurance premium payments more convenient.
• With Bima-ASBA, policyholders can block funds in their bank accounts for premium payments.
• These funds are held until the transaction is completed, ensuring smooth and secure payments without immediate debits from the account.
• This system aims to enhance the ease of paying insurance premiums and will be effective from March 1, 2025.

Question:

Q.1 What is the full form of ASBA in the Bima-ASBA payment mechanism?
a) Application Secured by Blocked Amount
b) Applications Supported by Blocked Amount
c) Advance Secured Banking Application
d) Automated Secured Banking Approval

Answer: b) ASBA stands for Applications Supported by Blocked Amount, a mechanism that allows users to block funds in their bank accounts instead of an immediate debit, ensuring secure transactions. Bima-ASBA applies this system to insurance premium payments.