Retirement planning is crucial for everyone, especially those working in India’s vast unorganized sector. The Atal Pension Yojana (APY) provides a secure and reliable way to ensure financial stability in your senior years. Launched by the Government of India, APY offers a guaranteed monthly pension, empowering you to live a dignified life after the age of 60. This comprehensive guide covers everything you need to know about APY, from eligibility and application to benefits and FAQs.
The Yojana is managed by the Pension Fund Regulatory and Development Authority (PFRDA) under the National Pension System (NPS). If you are familiar with any such poor people who need financial benefits, you can help them apply for Atal Pension Yojana. This comprehensive guide covers everything you need to know about APY, from eligibility and application to benefits and FAQs.
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What is Atal Pension Yojana (APY)?
Atal Pension Yojana Scheme is a social security initiative launched by the Government of India in May 2015 which completes 10 years in 2025. The objective of the scheme is to offer financial security to those working in the unorganized sector in their old age. Under APY, the beneficiary will continue to get a fixed monthly pension even after the age of 60.
The responsibility of this scheme is handled by the Pension Fund Regulatory and Development Authority and comes under the National Pension System. The government also contributes to promote the scheme, which makes it safer and more lucrative. It is beneficial for those who work in non-regulated sectors and don’t have any pension plan for the future.
Who can Apply for Atal Pension Yojana Scheme?
To enroll in the Atal Pension Yojana, you must meet the following criteria:
- Be an Indian citizen.
- Be between 18 and 40 years of age.
- Have a savings account with a bank or post office.
- Not be an income tax payer since 1st October, 2022.
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Atal Pension Yojana: Details
In this scheme, members make regular but small contributions according to their age and pension amount chosen, which will give them a monthly pension of Rs. 1000 to Rs. 5000 after they turn 60. After completing the age of 60, the applicant of this scheme will get a guaranteed monthly pension of Rs. 1000, Rs. 2000, Rs. 3000, Rs. 4000 or Rs. 5000 depending on his contribution.
To understand it, if a person of 18 years wants a pension of Rs. 1000 in his old age, then he will have to contribute Rs. 42 per month in this scheme from now on. If a 40-year-old person wants to get a pension of Rs. 5000, then he will have to deposit Rs. 1454 per month. The contribution of a 40-year-old person is more here because he now wants a pension every month only after 20 years, and he has chosen a higher pension amount (Rs. 5000).
Objectives of Atal Pension Yojana
The main objective of Atal Pension Yojana (APY) is that the poor or the low income group people of the country can get some financial security in their old age. Those who work in the unorganized sector, like daily wage laborer,s don’t have any permanent pension scheme and they remain financially insecure in their old age. To solve this problem, Atal Pension Yojana was started.
The Atal Pension Yojana Scheme encourages people to save for retirement and offers a steady income after the age of 60. It also encourages early savings.
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Atal Pension Yojana Benefits:
The Atal Pension Yojana offers several key benefits:
- Guaranteed monthly pension: Receive a fixed pension ranging from Rs. 1,000 to Rs. 5,000 after turning 60, based on your contributions.
- Government contribution: The government contributes 50% of your contribution or Rs. 1,000 per year for 5 years, whichever is lower.
- Tax benefits: Contributions under APY are eligible for tax deductions under Section 80CCD(1) of the Income Tax Act.
- Secure investment: As a government-backed scheme, APY offers minimal risk and secure returns.
Penalties for late payments:
If a member misses their monthly contribution, a late fee is levied. The penalty structure is as follows:
- For contributions up to Rs. 100 per month: Rs. 1 per month.
- For contributions between Rs. 101 and Rs. 500 per month: Rs. 2 per month.
- For contributions between Rs 501 and Rs. 1000 per month: Rs. 5 per month.
- For contributions of Rs. 1001 and above: Rs. 10 per month.
- If payments are missed for 6 months, the account is frozen.
- If payments are missed for 12 months, the account is terminated and the owed amount, including interest, is returned.”
| Monthly amount contributed | Penalty Amount |
| Rs. 100 | Rs. 1 |
| Rs. 101 to Rs. 500 | Rs. 2 |
| Rs. 501 to Rs. 1000 | Rs. 5 |
| Rs. 1001 and above | Rs. 0 |
Atal Pension Yojana Scheme: Documents Required
- Aadhaar Card
- Bank account details (copy of first page of passbook or account number and IFSC code).
- Mobile Number
- Details of the nominee (the person who would need the pension in your place in case you are no longer alive, like your wife, and your relationship with them).
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How to Apply for Atal Pension Yojana: Applying for APY Scheme
Those who want to apply for the Atal Pension Yojana Scheme can do so online or offline. We have explained both the processes below.
(A) How to apply for Atal Pension Yojana Online
- Download your bank’s mobile banking app or visit the online official website. Log into your account.
- Search for the option to apply for APY scheme.
- If you can’t find it, search for it by typing Atal Pension Yojana directly in search bar above.
- Key in your personal information, nominee details and pension option in the online form.
- Choose the amount you want to contribute every month. You can also choose an auto payment option.
- Check the filled details thoroughly and click on Submit.
- As soon as you do this, your application process will be completed.
(B) How to apply for Atal Pension Yojana Offline
- Look for the address of your bank’s nearest branch and visit the bank. Most of the government and private banks in India have the facility to apply for Atal Pension Yojana.
- Ask for the application form from the bank official and fill it correctly.
- Submit your required certificates or documents like Aadhaar card copy, photo, and more.
- Activate the auto debit facility for contribution every month or every three months from your bank account.
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Atal Pension Yojana Chart
The above APY chart shows how much amount the members covered under this scheme have to deposit based on their age and the amount of pension they want, and the government keeps upgrading it every year.
Atal Pension Yojana Statement
To get your APY Statement online, follow these steps-
- Visit this website.
- Click on the APY e-PRAN/Transaction Statement View. Choose either one of the options.
- Click to search with PRAN or click to search without PRAN.
- On choosing first options, you will need to enter PRAN details. If you have forgotten it, you can check APY contributions by providing details like subscriber name, bank account, and date or birth.
- You will get two options: APY e-PRAN View or Statement of Transaction View. Choose one as per requirements
- Once you select the option, enter captcha code and click on ‘Submit’.
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Atal Pension Yojana Scheme: Benefits
- After turning 60, the applicant will continue to receive a monthly pension ranging from Rs. 1000 to Rs. 5000 as per the amount chosen by him/her.
- Although the scheme requires members to deposit a sum regularly, the government also adds 50% or Rs. 1000 per year for 5 years, thereby reducing members’ contribution slightly.
- Contributions or amounts given under this scheme are not taxable under section 80CCD (1) of the Income Tax Act.
- Since this is a government scheme, there is minimal risk on investment and secure returns are obtained.
Atal Pension Yojana Scheme: Limitations
- The maximum pension under APY of Rs. 5000 may be too small to cover most household expenses even at today’s prices.
- The scheme is available only for those who are not enrolled in any pension scheme like EPF.
- It is a long-term investment so any benefits will be available after the age of 60.
- APY is primarily for workers in the unorganized sector, so if you have access to other pension schemes, APY might not bethe best fit for you.
FAQs Related to Atal Pension Yojana Scheme (APY)
1. Who can join Atal Pension Yojana (APY)?
Any Indian citizen between the age of 18 to 40 years who has a bank account and is not a tax payer can join the scheme.
2. How is the pension amount determined?
The pension amount depends on the age of the member and the amount contributed. For example, for a monthly pension of Rs. 1000 at the age of 18, a contribution of Rs. 42 per month is needed.
3. What if the member dies before the age of 60?
In the case of death of a member before the age of 60, his/her spouse can continue contributing to the scheme or claim the lump sum amount.
4. Is it possible to change the contribution amount?
Yes, members can increase or decrease their contribution amount once a year, in April.
5. What happens if there is a default in contribution?
In case of missed contribution, a late fee is levied, which can range from Rs. 1 per month to Rs. 10 per month.
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