Atal Pension Yojana (APY) – Govt’s Scheme – Details, Features & Benefits

Our honorable PM, Shri Narendra Modi has launched three JAN SURAKSHA schemes on 9thMay, 2015. These three schemes are Atal Pension Yojana (APY), Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and Pradhan Mantri Suraksha Bima Yojana (PMSBY) .

PMJJBY and PMSBY are insurance related schemes, whereas APY is a pension scheme for citizens of India, primarily focused on the unorganized sector workers. Under the APY scheme, a guaranteed minimum pension of Rs. 1,000/-, 2,000/-, 3,000/-, 4,000 and 5,000/- per month will be given at the age of 60 years depending on the contributions made by the subscribers.

In case of death of the subscriber, pension amount will be given to the spouse, and on the death of both (subscriber & spouse), the accumulated pension corpus would be returned to the subscriber’s nominee.

Let’s understand more about Atal Pension Yojana (APY) scheme in FAQ format.

Atal Pension Yojana (APY) – Details, Features & FAQs

• Who can enroll for (or) join APY scheme? – Any Citizen of India can join APY scheme. The following are the eligibility criteria;
  • The age of the subscriber should be between 18 – 40 years.
  • He / She should have a savings bank account/ open a savings bank account.
  • The prospective applicant should be in possession of mobile number and its details are to be furnished to the bank during registration.
• Can subscribers / members of EPF (Employees Provident Fund) subscribe to APY scheme? – Yes, the beneficiaries of any social security schemes can also enroll for this scheme.
• Can I open two or more APY accounts? – No, only one account per person is allowed. Savings bank account is mandatory to open an APY account.
• How to open Atal Pension Yojana Account? – Approach the bank branch where your savings bank account is held. Fill up the APY registration form. Provide Aadhaar/Mobile Number. Ensure keeping the required balance in the savings bank account for transfer of monthly contribution.
  • Latest update (26-Jan-2018) : Small Finance Banks and Payment Banks to offer Atal Pension Yojana.
• What is the mode of contribution to APY A/c? – All the contributions are to be remitted monthly through auto-debit facility from savings bank account of the subscriber.
• I don’t have Aadhar number. Can I join Atal Pension scheme? – It is not mandatory to provide Aadhaar number for opening APY account. However, For enrollment, Aadhaar would be the primary KYC document for identification of beneficiaries, spouse and nominees to avoid pension rights and entitlement related disputes in the long-term.
• How much pension am I going to get? – The lifelong pension amount that you receive from 60 years of age is dependent on the contribution amount during accumulation stage. The pension amount ranges from Rs 1,000 to Rs 5,000 (in the multiples of 1000’s).
• Which authority is going to administer this scheme? – APY scheme is administered by PFRDA (Pension Fund Regulatory and Development Authority ) Or Government. (PFRDA also administers National Pension System – NPS)
• Is Government going to contribute any amount to my APY account? – Government co-contribution is available for 5 years, i.e., from 2015-16 to 2019-20, for the subscribers who join the scheme during the period from 1st June, 2015 to 31st December, 2015 and who are not covered by any Statutory Social Security Schemes and are not income tax payers. That means, if you are contributing to say EPF or any other similar schemes, then you will not be eligible to receive Govt’s co-contribution amounts.
  • (Latest News : 19-Jan-2016 –  Extension of time-line upto 31st March, 2016 for Government Co-contribution under the Atal Pension Yojana (APY). The Government has decided that the co-contribution by the Central Government will be available for those eligible subscribers, who join APY before 31st March, 2016)
• What will happen if required or sufficient amount is not maintained in the savings bank account for contribution on the due date? – Non-maintenance of required balance in the savings bank account for contribution on the specified date will be considered as default. Banks are required to collect additional amount for delayed payments, such amount will vary from minimum Re 1 per month to Rs 10/- per month as shown below:
  • Re. 1 per month for contribution up to Rs. 100 per month.
  • Rs 2 per month for contribution up to Rs. 101 to 500/- per month.
  • Rs 5 per month for contribution between Rs 501/- to 1000/- per month.
  • Rs 10 per month for contribution beyond Rs 1001/- per month.

• What will happen to my APY account if I discontinue the payments? – Discontinuation of payments of contribution amount shall lead to following:
  • After 6 months account will be frozen.
  • After 12 months account will be deactivated.
  • After 24 months account will be closed.

Subscriber should ensure that the Bank account to be funded enough for auto debit of contribution amount.

• Are there any income tax benefits available? – No tax deductions are available on the contribution amounts to APY.   Latest update (23-Feb-2016) : Contributions to ‘Atal Pension Yojana’ are now eligible for Tax Deduction under section 80CCD. 
• How to know my APY account balance amount? – You will receive SMS alerts related to account details/activity. You will also receive a physical statement at regular intervals.
• Can I change monthly contribution amount? – Yes, the monthly contribution can be changed once in a year for higher / lower pension amount.
• Can I exit from APY scheme before attaining 60 years? – The Exit before age 60 would be permitted only in exceptional circumstances, i.e., in the event of the death of beneficiary or terminal disease.
• Settlement of Death Cases before the age of 60 years of the Subscriber :
  • If the subscriber dies before the age of 60 years, his/her spouse would be given an option to continue contributing to APY Scheme, for the remaining vesting period, till the original subscriber would have attained the age of 60 years.
  • In case the spouse of the subscriber wishes to exit from the scheme and close the account, the corpus will be settled in the name of surviving spouse (if spouse is not present, will be settled in the name of the Nominee).
  • Below is the Account Closure Form (Death cases).

How much should I invest in Atal Pension Yojana to get the guaranteed pension of Rs. 1000 / Rs 2,000 / Rs 3,000 / Rs 4,000 / Rs 5,000?

Below is the indicative contribution chart (Age Vs Pension amount). For example – A 30 year old individual has to contribute Rs 577 per month, to get Rs 5,000 per month pension amount. He/she has to make the contributions for 30 years (60 years minus 30 years age).