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Atal Pension Yojana

IndianMoney.com Research Team | Posted On Saturday, October 06,2018, 11:21 AM

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Atal Pension Yojana

 

 

Atal Pension Yojana Scheme which was discontinued has recently been extended by the Union Cabinet.  Listed below are the details you need to know on the scheme.

Atal Pension Yojana is a pension scheme launched by the Government in 2015 that focuses on the unorganized sector, with the aim to provide pension to citizens like maids, drivers, gardeners and so on.  Individuals aged between 18-60 years can invest in this scheme and earn fixed pensions. According to reports, about 1 Crore citizens have benefitted from this social security scheme.  Due to its huge success, the Union Cabinet has extended the scheme and is considering a proposal to raise the pension limit to Rs 10,000 a month. The scheme also spans across individuals to households with revised terms and benefits.

The Atal Pension Yojana is a guaranteed pension scheme launched by the Union Government that aims to secure pension for the workers in the unorganised sector. The government has introduced this scheme to address the longevity risks associated with the workers in the unorganized sector and to encourage the workers in unorganized sector to voluntarily save for retirement. 

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All You Need To Know About Atal Pension Yojana

The scheme aims to cover individuals working in the unorganized sector and bring them under pension cover. The basic criteria of Atal Pension Yojana are the individual must be a citizen of India and also within the age group of 18-40 years to join the scheme. He/She should not be a part of any other social security scheme like the EPF. He also needs to have a bank account and proper identification proof to avail the benefits of this scheme.

Atal Pension Yojana Documents required:

To subscribe to this scheme, you must visit any nationalized bank or Post Office and fill the APY form. The individual also needs to submit authorized documents like address proof say Aadhaar, photographs, birth certificate and bank account number, along with branch name and the bank name. The individual also needs to submit his current mobile number, along with the registration form to receive regular updates and information regarding APY account balance through SMS.

See Also: National Pension System

Atal Pension Scheme details:

The minimum pension offered under Atal Pension Yojana is Rs 1,000, Rs 2,000, Rs 3,000, Rs 4,000 and Rs 5,000 a month. You get to choose the minimum pension, when you subscribe to the APY scheme. You get one of the pension amounts on attaining 60 years. The amount you get depends on the contributions.

Atal Pension Yojana Benefits:

With the aim to reach out to more people, the improved scheme comes with revised terms and benefits.

Atal Pension Yojana Tax benefit:Tax benefit will be given to the scheme holders under Section 80CCD on the contributions made.

Guaranteed pension:  The government guarantees pension up to Rs 5,000 a month. If the actual returns on the pension contributions are higher, then the pension will also be higher.

Pension to the spouse: In case of death of the scheme holder, pension would be given to the spouse.

Corpus to the nominee: In case of death of both the APY scheme holder and spouse, the pension corpus will be returned to the nominee.

Atal Pension Yojana Scheme Eligibility:

The Atal Pension Scheme helps workers save money for their old age during working years and guarantees returns post retirement. The benefits of this scheme can be availed if the below mentioned requirements are fulfilled:

  • The applicant must be a citizen of the country
  • He must be in the age group of 18 to 40
  • The applicant must make contributions for a minimum of 20 years to get the benefits
  • The applicant should have a bank account linked to Aadhaar
  • The applicant must have a valid mobile number.

Monthly Contributions

To avail the benefits of the pension scheme you are required to contribute a monthly amount based on the pension plan that in turn promises a fixed amount of monthly pension of Rs 1000 to Rs 5000. Your monthly contribution depends on the fixed amount of monthly pensions that an individual wants, the age at which the person starts contributing and the number of years of contribution. The pension starts at the age of 60 years. Therefore, if a person joins the scheme at the age of 40 years, than the contributions made must be for a minimum tenure of 20 years to avail the benefits of the scheme. The following table demonstrates the contribution that needs to be made per annum based on age and the pension plan:

How to apply for Atal Pension Yojana online?

An individual willing to subscribe to this scheme, can visit any nationalized bank and avail the benefits of the scheme. He can also apply online. The forms are available in vernacular languages and need to be downloaded from the official website. As instructed, complete the documentation with proper information and submit at the branch along with a copy of the Aadhaar card and the current contact number. The applicant must have a savings bank account and must maintain sufficient balance in his/her savings account, for auto debit towards the Atal Pension Yojana each month.

Important Facts to know about APY:

Listed below are some important facts that you should know on the Atal Pension Yojana:

  • As the subscriber of this scheme make a periodic contribution, the amount is automatically debited from the subscriber’s account. The subscriber needs to make sure there is sufficient balance in the bank account that is linked to the Atal Pension Scheme.
  • The scheme provides its subscribers with the benefit of increasing the premium amount as per their wishes at any point during the contributing period. The subscriber needs to visit the bank and talk to the manager to make the necessary changes in the scheme.
  • In case of default of payments, a charge will be levied as penalty. The penalty charged is Rs 1 per month for a contribution of every Rs 100 or part thereof.
  • In case of default of payments for 6 months, the account will be frozen. In case the default continues for a period of 12 months the account will be closed and the amount accumulated as contribution will be paid back to the subscriber.
  • The subscriber of the scheme is not eligible to withdraw the amount before 60 years. Only in cases like death or terminal illness, the subscriber or the nominee will receive the entire amount.
  • If the subscriber closes the scheme before the age of 60 years for any reason, then only the contribution plus interest earned will be returned. The subscriber will not be eligible to receive the government’s contribution or the interest earned on that amount.
  • Charges will be levied in case of default in payments that is Rs 1 for every Rs 100 payable; and in case of payment default of 6 months, the account will be blocked. In case of default for 12 months the account will be closed and the funds will be returned to the subscriber.
  • Early withdrawal is not allowed, but in cases of death or terminal illness an exception can be made.
  • Closing the scheme before 60 years of age for any reason will mean the subscriber is entitled only to the contribution and interest earned on that amount. This will not include government’s contribution.

How to Subscribe to Atal Pension Yojana (APY):

To subscribe for the government’s pension benefit scheme follow the below points:

  • All Nationalized banks are eligible to provide this scheme. The applicant can visit any of the nationalized banks to start the APY account.
  • The application form of the Atal Pension Yojana are available both online and offline. The online form can be downloaded from the official website. The forms can be also collected from the banks.
  • The forms are available in all major Indian languages.
  • You can get enrolled for APY scheme online through your savings bank account directly using internet banking facility. Chose the auto debit facility for the payment of monthly premiums. Only SBI and ICICI bank is providing the net banking facility for APY.
  • In case you are opting for the offline method, collect the form from the bank and submit the duly filled form at your branch.
  • Provide a valid mobile number
  • Submit a copy of the Aadhaar card along with your form.

FAQs on APY:

How will I know if the pension scheme is activated?

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

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

Any person between the age of 18 to 40 years can join the scheme. There is no last date to join the scheme. The applicant can submit an application before the 1st of June to join the scheme for the coming year.

What is the minimum and maximum age to join this scheme?

The minimum age to join the scheme is 18 years. The maximum age is 40 years. This is because the minimum period of contribution for the scheme is 20 years.

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

The Atal Pension Yojana scheme is passed by the government of India in the budget session. The scheme will not be discontinued if there is a change in the Government, and the contributions made towards the scheme are safe. The succeeding Governments only have the right to change the name of the pension scheme.

Can I apply for APY online?

Currently there are no options to apply for this scheme online. The applicant must go to the bank, collect the form and submit the duly filled form to subscribe to this scheme.

Only SBI and ICICI bank is providing the net banking facility for APY.

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

To subscribe to the Atal Pension Yojana, the applicant needs to fill the application form and attach a copy of the Aadhaar along with the form and submit it. No other documents are required for this scheme.

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