Last Updated on June 9, 2023 by IGNOU Forum
Atal Pension Yojana (APY) is a pension scheme launched by the Government of India in 2015. It is open to all citizens of India, particularly those who are not covered by any other pension scheme and do not have any regular source of income. The APY is administered by the Pension Fund Regulatory and Development Authority (PFRDA) and aims to provide a fixed monthly pension to individuals during their old age, starting at the age of 60. The pension amount is based on the contribution made by the individual during their working years and the age at which they join the scheme. The APY is open to individuals in the age group of 18 to 40 years and contributions can be made by individuals or by their families on their behalf. The APY is an important initiative by the government to provide a social safety net for the citizens of India and to ensure that they have a secure and financially stable old age.
Benefits of Atal Pension Yojana
The Atal Pension Yojana (APY) provides a number of benefits to its subscribers:
- Fixed pension: APY provides a fixed monthly pension to its subscribers starting at the age of 60. The pension amount is based on the contribution made by the individual and the age at which they join the scheme.
- Social security: APY serves as a social security measure for individuals who do not have any other pension scheme or regular source of income. It provides financial security during old age.
- Tax benefits: Contributions made towards APY are eligible for tax benefits under section 80CCD(1) of the Income Tax Act.
- Nomination facility: APY provides the facility for subscribers to nominate a person to receive the pension in case of the subscriber’s death.
- Portability: APY subscribers have the option to change their pension fund manager or switch to a different pension scheme without any exit charges.
- Easy enrollment: APY can be easily enrolled through various channels such as banks, post offices, and Common Service Centers (CSCs).
- Government contribution: The government also provides a matching contribution for every contribution made by the subscriber, up to a certain limit. This is applicable for individuals who join the scheme before the age of 40.
Eligible Criteria of APY
To be eligible for Atal Pension Yojana (APY), an individual must meet the following criteria:
- Citizenship: The individual must be a citizen of India.
- Age: The individual must be between the ages of 18 and 40 years.
- Bank account: The individual must have a bank account in their name.
- No other pension scheme: The individual must not be a member of any other statutory social security scheme and must not be receiving any other pension.
- Income: The individual’s annual income must not exceed Rs 10 lakhs.
- Contribution: The individual must make regular contributions towards the APY.
Note: If an individual meets all of the above criteria, they are eligible to enroll in the Atal Pension Yojana.
The Success of Atal Pension Yojana
The Atal Pension Yojana (APY) has been successful in increasing the coverage of pension schemes in India and providing a social safety net to a large number of citizens. As of December 2021, the APY had over 77 million subscribers and had disbursed over 55,000 crores in pension to its beneficiaries.
The APY has also been successful in increasing financial inclusion in the country, as it is easily accessible through various channels such as banks, post offices, and Common Service Centers (CSCs). It has also been successful in promoting the habit of saving for old age among individuals who may not have otherwise had access to a pension scheme.
In addition, the APY has received positive feedback from its subscribers, with many praising its easy enrollment process and the flexibility it provides in terms of pension amount and contribution frequency.
Overall, the Atal Pension Yojana has been successful in achieving its goals of providing a social safety net for the citizens of India and promoting financial inclusion in the country.
How to Apply for APY?
To apply for Atal Pension Yojana (APY), you can follow these steps:
- Set up an auto-debit facility to ensure that your contributions towards APY are made regularly.
- Visit your nearest bank branch or Common Service Center (CSC). You can also apply online through the APY portal (https://www.pfrda.org.in/home/know-your-apy) or through the National Pension System (NPS) portal (https://www.npscra.nsdl.co.in/scheme-details.php).
- Fill out the APY application form and submit it along with the required documents. These may include proof of identity, proof of address, and proof of age.
- Make the initial contribution towards APY. The amount of the contribution will depend on the pension amount you wish to receive and the age at which you join the scheme.
- Your APY account will be created and you will be provided with an APY account number. You can use this number to track the status of your APY account and make any changes to your account details.
Note: It is important to ensure that you make regular contributions towards APY in order to receive the pension when you reach the age of 60.
Frequently Asked Questions About the Atal Pension Yojana (APY):
What is the age limit for joining APY?
The age limit for joining APY is between 18 and 40 years.
Is there an upper limit on the annual income of APY subscribers?
Yes, the annual income of APY subscribers should not exceed Rs 10 lakhs.
Can a subscriber change their pension fund manager or switch to a different pension scheme?
Yes, APY subscribers have the option to change their pension fund manager or switch to a different pension scheme without any exit charges.
Is it mandatory to make regular contributions towards APY?
Yes, it is mandatory for APY subscribers to make regular contributions towards the scheme.
Can a subscriber nominate a person to receive the pension in case of their death?
Yes, APY provides the facility for subscribers to nominate a person to receive the pension in case of the subscriber’s death.
Are contributions made towards APY eligible for tax benefits?
Yes, contributions made towards APY are eligible for tax benefits under section 80CCD(1) of the Income Tax Act.
Can a subscriber withdraw from APY before the age of 60?
No, APY subscribers cannot withdraw from the scheme before the age of 60. The pension is paid out starting at the age of 60 and is based on the contributions made by the subscriber.