Explainer | What is Atal Pension Yojana?

The Atal Pension Yojana is a plan aimed at unorganised workers such as maids, gardeners, and delivery boys. The former Swavalamban Yojana, which was not well received by the public, is replaced by this scheme.

The scheme's purpose is to ensure that no Indian citizen in their old age has to worry about illness, accidents, or diseases, providing a sense of security. Employees in the private sector or those who work for a company that does not offer a pension plan can also apply for the scheme.

When you reach the age of 60, you have the option of receiving a fixed pension of ₹1000, ₹2000, ₹3000, ₹4000, or ₹5000. The amount of the pension will be determined by the individual's age and the amount of contributions made. 

When a contributor dies, his or her spouse is entitled to the pension, and when both the contributor and his or her spouse die, the nominee is entitled to the accumulated corpus. 

If the contributor dies before reaching the age of 60, the spouse has the option of either exiting the scheme and claiming the corpus or continuing the programme for the remainder of the term.

The collected funds under the scheme will be administered by the Pension Funds Regulatory Authority of India (“PFRDA”), according to the government of India’’s investment pattern.

All qualifying subscribers who joined between June 2015 and December 2015 for a period of 5 years, i.e., for financial years 2015-16 to 2019-20, would get a co-contribution of 50% of the entire contribution, or Rs. 1,000 per annum, whichever is lesser. 

To qualify for the government's co-contribution, subscribers must not be enrolled in any other statutory social security schemes (for example, employee's provident fund) or pay income taxes.

Eligibility criteria for Atal Pension Yojana

• To be eligible for the Atal Pension Yojana, you must meet the following criteria:
• You must be an Indian citizen between the ages of 18 and 40 years old.
• Contributions should be made for at least 20 years.
• You must have a bank account that is connected to your Aadhar number.
• A valid mobile phone number is required.

Those who are now receiving Swavalamban Yojana benefits will be automatically transferred to the Atal Pension Yojana.

How to apply for Atal Pension Yojana?

To take advantage of the APY, follow these procedures.

• The scheme is available at all nationalised banks. You can open an APY account with any of those banks.
• Forms for the Atal Pension Yojana are available both online and at the bank. The form can be downloaded from the official website.
• English, Hindi, Bangla, Gujarati, Kannada, Marathi, Odia, Tamil, and Telugu are among the languages accessible.
• Complete the application and send it to your bank.
• If you haven't previously done so, supply a valid mobile phone number.
• Make a photocopy of your Aadhaar card and send it in.
• When your application is approved, you will receive a confirmation message.

Monthly Contributions

The amount of your monthly contribution is determined by the amount of pension you want to receive when you retire and the age at which you begin contributing. Based on your age and pension plan, the table below shows how much you should contribute each year.

Important facts to know about Atal Pension Yojana

• Because you will be making regular contributions, your account will be deducted automatically. Before each debit, double-check that your account balance has sufficient funds.
• You have the option to increase your premium at any time. All you have to do now is go to your bank, speak with your manager, and make the appropriate modifications.
• If you do not make your payments on time, you will be charged a penalty. A monthly penalty of Rs. 1 for each contribution of Rs. 100 or portion thereof.
• If you miss six payments in a row, your account will be frozen; if you miss twelve payments in a row, your account will be cancelled, and the remaining amount will be given to the subscriber.
• It is not permissible to withdraw early. Only in exceptional circumstances, such as death or terminal illness, would the subscriber or his/her nominee be reimbursed in full.
• Only your deposit plus interest earned will be repaid if you close the scheme before reaching the age of 60 for whatever reason. You will not be entitled to the government's co-payment or any interest generated on that money.

Tomorrow, even if the government changes the plan, your contribution will remain protected. The only change successive governments can introduce is amending the name of the pension programme. Therefore, your contribution will continue to remain safe and secure.