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ATAL PENSION YOJANA (APY) – A SOCIAL SECURITY SCHEME

Government of India has introduced a redefined Pension scheme to the General public of the country to provide financial and social security. The pension scheme launched by the Government of India called “Atal Pension Yojana” (APY) is a modified version of the existing “Swavalamban” scheme and provides a defined pension depending on the contribution and its period.

While the APY is open for all citizens who have a bank account it is focused mainly on all citizens in the unorganized sector who wish to join the National Pension System (NPS) administered by the Pension Fund Regulatory and Development Authority (PFRDA). Under the APY, the subscribers would receive the fixed minimum pension ranging between Rs. 1000 per month to Rs. 5000 per month, at the age of 60 years, depending on their contributions, which itself would be based on the age of joining the APY, with minimum age of joining APY being 18 years and maximum age being 40 years. The subscriber should be an account holder with the bank. The benefit of fixed minimum pension is being guaranteed by the Government. The APY has been introduced from 1st June, 2015.

Further, GOI clarifies that, those who are income tax payers and also the members of any statutory social security scheme are also eligible to join APY and avail the benefits of the monthly pension.

Benefits of APY

Fixed pension for the subscribers ranging between Rs. 1000 to Rs. 5000, if the subscriber joins and contributes between the age of 18 years and 40 years. The contribution levels would vary and would be low if subscriber joins early and progressively increases if joining late.

For the Customer:
  • Guaranteed minimum pension amount for securing Old age. No other Pension scheme has such a Guarantee.
  • Income tax benefit under 80CCD.
  • Returns of 8% at present,(depends on the performance of the scheme)
  • Choice for exiting from scheme at any time
  • Spouse gets the same pension as the subscriber during her/his life and Nominee gets the corpus amount.
  • Can subscribe on Monthly/Quarterly/Half yearly basis
  • Auto debit of subscription amount

Eligibility for APY

  • Atal Pension Yojana (APY) is open to all bank account holders between the age group of 18 years and 40 years.
  • Date of Birth proof is mandatory
  • Primary KYC for bank account will be Aadhaar at the time of opening account.
  • Non-aadhaar bank account customers can join, but have to provide Aadhaar details on or before 31st December 2017
  • Valid mobile number is mandatory

Exit and pension payment:

  • Upon completion of 60 years, the subscribers will submit the request to the associated bank for drawing the guaranteed monthly pension.
  • Exit before 60 years of age is not permitted, however, it is permitted only in exceptional circumstances, i.e., terminal disease, not able to pay contibutions, required funds urgently and any other valid reason.