Best Pension Plan : ATAL PENSION YOJANA (APY)

By | November 24, 2015
(Last Updated On: November 24, 2015)

NOTIFICATION F.NO.16/1/2015-PR- ATAL PENSION YOJANA, DATED 16-10-2015

Background

1. The Government of India has introduced a pension scheme called the Atal Pension Yojana (APY), with effect from 1st June, 2015, pursuant to the announcement in the budget for 2015-16 on creating a universal social security system for all Indians, especially the poor, the under-privileged and the workers in the unorganised sector. ATAL PENSION YOJANA  is being administered by the Pension Fund Regulatory and Development Authority (PFRDA) under the overall administrative and institutional architecture of the National Pension System (NPS).

Eligibility for joining ATAL PENSION YOJANA 

2. ATAL PENSION YOJANA  is open to all citizens of India who have a savings bank account. The minimum age of joining ATAL PENSION YOJANA  is 18 years and maximum age is 40 years.

Features of ATAL PENSION YOJANA 

3. ATAL PENSION YOJANA is a voluntary, periodic contribution based pension system, under which the subscriber would receive the following benefits:

(i) Central Government guaranteed minimum pension amount : Each subscriber under ATAL PENSION YOJANA  shall receive a Central Government guaranteed minimum pension of Rs. 1000 per month or Rs. 2000 per month or Rs. 3000 per month or Rs. 4000 per month or Rs. 5000 per month, after the age of 60 years until death.
(ii) Central Government guaranteed minimum pension amount to the spouse : After the subscriber’s demise, the spouse of the subscriber shall be entitled to receive the same pension amount as that of the subscriber until the death of the spouse.
(iii) Return of the pension wealth to the nominee of the subscriber : After the demise of both the subscriber and the spouse, the nominee of the subscriber shall be entitled to receive the pension wealth, as accumulated till age 60 of the subscriber.

Contribution payment by subscribers

4. The subscriber’s contributions to ATAL PENSION YOJANA  shall be made through the facility of ‘auto-debit’ of the prescribed contribution amount from the savings bank account of the subscriber in monthly, quarterly or half-yearly frequency. The subscribers are required to contribute the prescribed contribution amount from the age of joining ATAL PENSION YOJANA  till age 60. The details of age-wise, pension-wise and contribution-frequency-wise prescribed contribution amount and the indicative pension wealth available for the nominee is given in the table at Annex – 1.

Eligibility for co-contribution by Central Government

5. The subscribers in the eligible age, who are not income-tax payers and who are not covered under any statutory social security scheme, are entitled to receive:

(i) The co-contribution by Central Government of 50% of the total prescribed contribution, upto Rs. 1000 per annum, will be available for those eligible subscribers who join ATAL PENSION YOJANA  before 31st December, 2015.
(ii) The Central Government co-contribution shall be available for a period of 5 years, i.e., from Financial Years 2015-16 to 2019-20.

Additional voluntary co-contribution by State Governments

6. State Governments are enabled to provide additional voluntary co-contribution to ATAL PENSION YOJANA  subscribers of their State. The procedure would be prescribed by PFRDA, in consultation with the Central Government.

Process for enrolment under ATAL PENSION YOJANA 

7. All citizens of India in the age group of 18-40 years can enroll themselves under ATAL PENSION YOJANA by submitting the duly completed application form to any enrolment agency.

Enrolment agencies under ATAL PENSION YOJANA 

8. ATAL PENSION YOJANA  applications may be submitted to any of the following enrolment agencies:

(i) All banks, including all nationalised banks, private banks, banking companies, regional rural banks, cooperative banks etc. either directly or through the following enablers:
(a) All Points of Presence (Service Providers) and Aggregators, which are governed under the institutional architecture of NPS and are appointed as such by PFRDA could work as facilitators with banks.
(b) Those Business Correspondents (BCs) / existing non-banking aggregators, Micro Finance Institutions (MFIs) etc. who are appointed as enablers by banks.
(ii) Other enrolment agencies that may be specified as such by PFRDA or the Central Government, such as, Department of Posts under CBS Platform.

Charges and fees and overdue interest under ATAL PENSION YOJANA 

9. The charges and fees and the overdue interest for nonpayment or delayed payment of prescribed contribution amount shall be levied on the subscribers of ATAL PENSION YOJANA . These charges and their method of application shall be prescribed by PFRDA from time to time, in consultation with the Central Government.

Reimbursement of promotional expenditure and Incentive for enrolment of subscribers and sharing of incentives

10. The Central Government shall reimburse the expenditure done on promotional and development activities by the contribution collection agencies to encourage people to join ATAL PENSION YOJANA  in a manner as prescribed by the Central Government. Banks and other enrolment agencies shall also be paid incentives for enrolments under ATAL PENSION YOJANA  which may shared by them with the BCs/MFIs/Non-Bank Aggregators in a ratio. The incentives payable to the banks and other enrolment agencies and the ratio of sharing of these incentives shall be prescribed by PFRDA from time to time in consultation with the Central Government.

Existing subscribers of Swavalamban Scheme

11. The existing subscribers of Swavalamban in the age group of 18-40 years shall be migrated to ATAL PENSION YOJANA  unless they exercise an option to opt-out. The remaining subscribers outside this age group would be governed by the Pension Fund Regulatory and Development Authority (Exits and Withdrawals under the National Pension System) Regulations, 2015.

Investment of the contributions under ATAL PENSION YOJANA 

12. The amount collected under APY shall be invested as per the investment pattern specified by the Central Government from time to time.

Exit, withdrawal and pension payment

13. On completion of 60 years, the subscriber will get the guaranteed minimum monthly pension, or higher monthly pension, depending on the investment returns. In exceptional circumstances, i.e., in the event of the death of beneficiary or specified illnesses, as mentioned in the Pension Fund Regulatory and Development Authority (Exits and Withdrawals under the National Pension System) Regulations, 2015, before the age of 60 years, the accumulated pension wealth till date would be given to the nominee or the subscriber, as the case may be. In case a subscriber, who has availed Government co-contribution under APY, chooses to voluntarily exit APY before the age 60, he shall only be refunded the contributions made by him to APY, along with the net actual interest earned on his contributions (after deducting the account maintenance charges), whereas, the Government co-contribution, and the interest earned on the Government co-contribution, shall not be returned to such subscribers.

ANNEX – 1

Monthly, Quarterly and Half-yearly prescribed contributions under ATAL PENSION YOJANA  for different minimum guaranteed amount of pension at different entry age and the return of corpus amount to the nominee

Minimum Guaranteed Pension of Rs. 1000/ month Minimum Guaranteed Pension of Rs. 2000/ month Minimum Guaranteed Pension of Rs.3000/ month Minimum Guaranteed Pension of Rs.4000/ month Minimum Guaranteed Pension of Rs.5000/ month
Return of Corpus Amount to the Nominee Rs. 1.7 Lakh Rs. 3.4 Lakh Rs. 5.1 Lakh Rs. 6.8 Lakh Rs. 8.5 Lakh
Age at entry Vesting period Monthly contri-bution Quar- terly contri-bution Half yearly contri-bution Monthly contri-bution Quar- terly contri-bution Half yearly contri-bution Monthly contri-bution Quar- terly contri-bution Half yearly contri-bution Monthly contri-bution Quar- terly contri-bution Half yearly contri-bution Monthly contri-bution Quar- terly contri-bution Half yearly contri-bution
18 42 42 125 248 84 250 496 126 376 744 168 501 991 210 626 1239
19 41 46 137 271 92 274 543 138 411 814 183 545 1080 228 679 1346
20 40 50 149 295 100 298 590 150 447 885 198 590 1169 248 739 1464
21 39 54 161 319 108 322 637 162 483 956 215 641 1269 269 802 1588
22 38 59 176 348 117 349 690 177 527 1045 234 697 1381 292 870 1723
23 37 64 191 378 127 378 749 192 572 1133 254 757 1499 318 948 1877
24 36 70 209 413 139 414 820 208 620 1228 277 826 1635 346 1031 2042
25 35 76 226 449 151 450 891 226 674 1334 301 897 1776 376 1121 2219
26 34 82 244 484 164 489 968 246 733 1452 327 975 1930 409 1219 2414
27 33 90 268 531 178 530 1050 268 799 1582 356 1061 2101 446 1329 2632
28 32 97 289 572 194 578 1145 292 870 1723 388 1156 2290 485 1445 2862
29 31 106 316 626 212 632 1251 318 948 1877 423 1261 2496 529 1577 3122
30 30 116 346 685 231 688 1363 347 1034 2048 462 1377 2727 577 1720 3405
31 29 126 376 744 252 751 1487 379 1129 2237 504 1502 2974 630 1878 3718
32 28 138 411 814 276 823 1629 414 1234 2443 551 1642 3252 689 2053 4066
33 27 151 450 891 302 900 1782 453 1350 2673 602 1794 3553 752 2241 4438
34 26 165 492 974 330 983 1948 495 1475 2921 659 1964 3889 824 2456 4863
35 25 181 539 1068 362 1079 2136 543 1618 3205 722 2152 4261 902 2688 5323
36 24 198 590 1169 396 1180 2337 594 1770 3506 792 2360 4674 990 2950 5843
37 23 218 650 1287 436 1299 2573 654 1949 3860 870 2593 5134 1087 3239 6415
38 22 240 715 1416 480 1430 2833 720 2146 4249 957 2852 5648 1196 3564 7058
39 21 264 787 1558 528 1574 3116 792 2360 4674 1054 3141 6220 1318 3928 7778
40 20 291 867 1717 582 1734 3435 873 2602 5152 1164 3469 6869 1454 4333 8581
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