What is Atal Pension Yojana?
Atal Pension Yojana (APY) is a government-backed pension
scheme aimed at providing a guaranteed minimum pension ranging from ₹1,000 to
₹5,000 per month to subscribers upon reaching the age of 60. The pension amount
depends on the contributions made by the subscribers during their working
years. The scheme is managed by the Pension Fund Regulatory and Development
Authority (PFRDA) under the broader framework of the National Pension System
(NPS).
Why was APY introduced?
The APY was announced in the 2015-16 budget with the vision of creating a universal social security system for all Indians, especially the poor, underprivileged, and workers in the unorganized sector. The primary objective is to provide a secure income during old age, reducing the dependence on social and family support.
Who can subscribe to APY? What are the eligibility criteria for APY?
1. Citizenship: APY is open to all Indian citizens.
2. Age: The minimum age to join is 18 years, and the maximum age is 40 years.
3. Bank Account: A savings bank account is required to subscribe to APY.
What are the main features of APY?
1. Voluntary and Periodic Contributions: Subscribers voluntarily contribute on a periodic basis (monthly, quarterly, or half-yearly) until they reach the age of 60.
2. Guaranteed Pension: Subscribers receive a guaranteed pension amount based on their contributions, ensuring financial stability in old age.
How can one open an APY account?
The process to enroll in APY is straightforward:
1. Visit Your Bank: Approach the bank where you have a savings account or open a new savings account.
2. APY Registration Form: Fill out the APY registration form with the help of bank staff.
3. Provide Aadhaar and Mobile Number: While not mandatory, providing these details can facilitate communication and management of your account.
4. Maintain Account Balance: Ensure there is sufficient balance in your savings account for the auto-debit of contributions.
What are the benefits of APY?
What are the pension benefits?
1. Subscriber's Pension: Upon reaching 60 years, the subscriber receives a guaranteed minimum pension of ₹1,000 to ₹5,000 per month, depending on their contributions.
2. Spouse's Pension: In the event of the subscriber's death, the spouse will receive the same pension amount until their death.
3. Nominee's Benefit: After the demise of both the subscriber and the spouse, the nominee will receive the accumulated pension wealth.
How are contributions made?
Subscribers contribute through auto-debit from their savings bank account. Contributions continue from the age of joining APY until the subscriber turns 60. The contribution amount varies based on the subscriber’s age at the time of joining and the desired pension amount.
What is the government co-contribution?
To incentivize participation, the Central Government offers co-contribution benefits:
1. Subscribers who are not income-tax payers and are not covered under any statutory social security scheme.
2. The government will co-contribute 50% of the total contribution amount, up to ₹1,000 per annum, for eligible subscribers who joined before December 31, 2015.
3. The co-contribution is available for a period of five years, from the financial year 2015-16 to 2019-20.
Is there additional support from State Governments?
Can State Governments contribute to APY?
Yes, State Governments have the option to provide additional
co-contributions to APY subscribers in their respective states. The procedures
for such contributions are prescribed by PFRDA in consultation with the Central
Government.
Where can one enroll for APY?
What are the enrolment agencies for APY?
APY enrolment can be done through various agencies:
1. Banks: All nationalized, private, regional rural, and cooperative banks.
2. Points of Presence (Service Providers): Aggregators governed under NPS institutional architecture.
3. Business Correspondents and Micro Finance Institutions: Appointed by banks as enablers.
4. Department of Posts: Other agencies as specified by PFRDA or the Central Government.
What are the charges and fees associated with APY?
Subscribers are subject to charges and fees for account
maintenance and overdue interest for late or non-payment of contributions.
These charges are prescribed by PFRDA in consultation with the Central
Government and are subject to periodic review.
What promotional incentives are available?
The Central Government reimburses expenses incurred on
promotional activities by collection agencies to encourage APY enrolment. Banks
and other enrolment agencies receive incentives for enrolling subscribers,
which can be shared with Business Correspondents and other non-banking
aggregators.
Are Swavalamban subscribers migrated to APY?
Existing Swavalamban subscribers aged 18-40 years are
automatically migrated to APY unless they opt-out. Subscribers outside this age
group will be governed by the Pension Fund Regulatory and Development Authority
(Exits and Withdrawals under the National Pension System) Regulations, 2015.
How are contributions invested under APY?
The contributions made under APY are invested according to
the investment pattern specified by the Central Government, ensuring the growth
and security of the pension fund.
How does one exit or withdraw from APY? What happens upon completion of 60 years?
Upon reaching 60 years, the subscriber receives the
guaranteed monthly pension. If the investment returns are higher, they may
receive a higher pension amount.
What are the provisions for exceptional circumstances?
In case of death or specified illnesses before 60 years, the accumulated pension wealth is paid to the nominee or subscriber. If a subscriber with government co-contribution exits APY voluntarily before 60, they will receive their contributions with net interest, excluding the government’s co-contribution and its interest.
Reference links:
Government Official link: Atal pension Yojana
Download Atal pension Yojana (APY) Form
The Atal Pension Yojana is a vital initiative for securing the financial future of India’s unorganized sector workers. By providing a guaranteed pension and encouraging savings from an early age, APY aims to reduce the financial uncertainty that often accompanies old age. With simple eligibility criteria, flexible contribution options, and government support, APY is an accessible and beneficial scheme for millions of Indians. As the program continues to evolve, it promises to be a cornerstone of India's social security system, ensuring dignity and financial independence for all in their later years.
