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With the successful implementation of Pradhan Mantri Jan Dhan Yojana and embracing huge population to avail the banking benefits with opening a zero balance account with the continuation of Jan Dhan Yojana a National Pension Scheme (NPS) which is known as Atal Pension Yojana (“APY”) was effected and passed in the Union Budget of 2015-16 by our honorable Finance Minister Mr. Arun Jaitley.


1. Introduction

Atal Pension Yojana is a pension scheme mainly aimed at the unorganized sector such as maids, gardeners, delivery boys, etc. This scheme replaced the previous Swavalamban Yojana which wasn’t accepted well by the people.

The goal of the scheme is to ensure that no Indian citizen has to worry about any illness, accidents or diseases at old age giving a sense of security. Private sector employees or employees working with such organization that does not provide them pension benefit can also apply for the scheme. There is an option of getting fixed pension of Rs 1000, Rs 2000, Rs 3000, Rs 4000, and Rs 5000 on attaining an age of 60. The pension will be determined depending on the individuals’ age and the contribution amount. The contributor’s spouse can claim  the pension upon the contributors’ death and upon death of both the contributor and his/her spouse, the nominee will be given the accumulated corpus. However, if the contributor dies before completing 60 years of age, spouse is also given an option to either exit the scheme and claim the corpus or continue the scheme for balance period. As per the investment pattern laid down by the government of India the collected amount under the scheme is to be managed by the Pension Funds Regulatory Authority of India (“PFRDA”).

The Government would also make a co-contribution of 50% of total contribution or Rs. 1000 per annum, whichever is lower, to all eligible subscribers who had joined between June 2015 and December 2015 for 5 years i.e., for financial years 2015-16 to 2019-20. The subscribers should not be part of any other statutory social security schemes (For eg: Employee’s provident fund) or should not be paying income taxes in order to avail Government’s co-contribution

2. Eligibility

To avail benefits from the Atal Pension Yojana, you must fulfill the below requirements:

  1. Must be a citizen of India.
  2. Must be between the age of 18-40
  3. Should make contributions for a minimum of 20 years.
  4. Must have a bank account and it has to be linked with your Aadhar
  5. Must have a valid mobile number

The existing people who are availing benefits of Swavalamban Yojana will be automatically migrated to Atal Pension Yojana.

3. How to Apply?

Follow these steps to avail the benefits of APY

  1. All nationalized banks provide these scheme. So you can visit any of these banks to start your APY account.
  2. Atal Pension Yojana Forms available online and at the bank. You can download the form from the official website.
  3. The forms are available in English, Hindi, Bangla, Gujarati, Kannada, Marathi, Odia, Tamil, and Telugu.
  4. Fill up the application form and submit it to your bank.
  5. Provide a valid mobile number, if you haven’t already provided to the bank.
  6. Submit a photocopy of your Aadhaar card.

You will be sent a confirmation message when the application is approved.

4. Monthly Contributions

The monthly contribution depends upon the amount of pension you want to receive upon retirement and also the age at which you start contributing. The following table tells you how much you need to contribute per annum based on your age and pension plan.

APY – Monthly contribution

5. Important Facts to know about APY

  1. Since you will be making timely contributions, the amounts will be debited automatically from your account. You need to make sure that you have sufficient balance in your account before each debit.
  2. You can increase your premium at your will. You just have to visit your bank and talk with your manager and make necessary changes.
  3. In case you default on your payments, a penalty will be levied. A penalty of Rs. 1 per month for a contribution of every Rs. 100 or part thereof.
  4. In case you default on your payments for 6 months, your account will be frozen and if the default continues for 12 months, the account will be closed and the remaining amount will be paid to the subscriber.
  5. Early withdrawal is not entertained. Only in cases like death or terminal illness, the subscriber or his/her nominee will receive the entire amount back.
  6. In the event you close the scheme before the age of 60 for any other reason, only your contribution plus interest earned will be returned. You will not be eligible to receive the government’s co-contribution or the interest earned on that amount.

6. FAQs on APY

Q: Can I apply for APY online?

A: No, currently there are no provisions to apply for APY online. You need to go to your bank and fill out the forms.

Q: What are the documents required to apply for the APY Scheme?

A: To apply for the APY scheme, you need to fill out the form and submit a photocopy of your Aadhar Card. No other documents are required.

Q: How will I know if the pension scheme is activated?

A: You will receive an SMS alert on your registered mobile number, informing you when the pension scheme is activated.

Q: When is the last date to join the Atal Pension Yojana Scheme?

A: The Atal Pension Yojana Scheme does not have the last date to join. Submit your application before June 1st to join the scheme for the coming year. The scheme is renewed on June 1st every year.

Q: What are the minimum and maximum age to join this scheme?

A: The minimum age is 18 years. The scheme is also open to college students. The maximum age is 40 years. This is because the minimum contribution period is 20 years. At the age of 60, you will start receiving your pension.

Q: Is my money safe? Will the scheme be changed when the government changes?

A: The Atal Pension Yojana scheme is passed by the Parliament of India in the budget session. The scheme will not be discontinued if there is a change in the Government, and your contribution is safe. Any succeeding Governments ha the right to only change the name of the pension scheme.

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