Atal Pension Yojana - APY Scheme

By : Neha Dhyani

Updated : Apr 15, 2022, 13:17

The Atal Pension Yojana or APY Scheme is a central government initiative to enable Indian citizens working in unorganised sectors to lead a happy life after retirement. The scheme was introduced on 9th May 2015.

According to an NSSO survey (66th Round), unorganised sector workers constitute 88% of India's gross labour force of 47.29 crores. The Atal Pension Yojana is one of the several schemes undertaken by the current government to ensure social security and economic freedom for the poor and underprivileged. The APY Scheme was announced in Budget 2015-16.

What is the Atal Pension Yojana?

The Atal Pension Yojana or APY Scheme is a flagship scheme of the central government ensuring a guaranteed pension amount to subscribers. The pension amount depends on the monthly contribution amount and period.

The scheme primarily targets people working in the unorganised sector who are voluntarily willing to join the NPS (National Pension Scheme) managed by the PFRDA (Pension Fund Regulatory and Development Authority).

The minimum fixed pension amount under the APY Scheme ranges between INR 1,000 and 5,000 per month after attaining the age of 60. The minimum entry age in the APY Scheme is 18 years, while the maximum age of entry is 40 years. Hence, under no circumstances would the minimum contribution period be less than 20 years.

Contributions in the APY Scheme are determined by the subscriber's age and contribution amount. Therefore, if a subscriber joins when young, the monthly payment amount will be lower than a person entering the scheme at 40.

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Atal Pension Yojana Account - Eligibility

Any bank account holder in India can open an Atal Pension Yojana Account.

The government also co-contributed 50% of the net contribution or INR 1,000 to each subscriber for five years between FY16 and FY20. However, the co-contribution benefits would only apply to subscribers who opened an APY account between 1st June 2015 and 31st December 2015.

Also, Atal Pension Yojana accounts can be opened by people not serviced by any statutory social security scheme and who do not pay Income Tax.

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Important Things About Atal Pension Yojana

Any bank account holder joining the APY Scheme must activate the auto-debit facility. The auto-debit facility reduces the contribution collection charges.

However, subscribers must maintain the required amount in their savings account to avoid paying late payment penalties. The due date for monthly payment depends on the first contribution date.

If a subscriber default repeatedly, the concerned bank may foreclose the account, and the Government of India will take away its co-contribution.

Also, if a subscriber hides any details or gives a false declaration, the government may charge a penal interest besides taking away the co-contribution amount.

Atal Pension Yojana or APY Scheme is one of India's most popular government schemes. According to PFRDA, 52 lakh new accounts were opened under the APY Scheme in 2020-21, taking the total enrolments to 2.75 crores.

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FAQs on Atal Pension Yojana

Q.1) What is Atal Pension Yojana?

Atal Pension Yojana or APY Scheme is a flagship scheme of the central government ensuring a guaranteed pension amount to subscribers.

Q.2) When was Atal Pension Yojana introduced in India?

Atal Pension Yojana or APY Scheme was introduced on 9th May 2015.

Q.3) Who manages Atal Pension Yojana?

Atal Pension Yojana is managed by PFRDA or Pension Fund Regulatory and Development Authority.

Q.4) How many accounts have been opened under Atal Pension Yojana?

According to PFRDA, 52 lakh new accounts were opened under the Atal Pension Yojana or APY Scheme in 2020-21, taking the total enrolments to 2.75 crores.