• A Pension provides people with a monthly income when they are no longer earning.

• Need for Pension:

1. Decreased income earning potential with age.
2. The rise of nuclear family-Migration of earning members.
3. Rise in cost of living.
4. Increased longevity.
5. Assured monthly income ensures dignified life in old age.

Atal Pension Yojana (APY), a pension scheme for citizens of India, is focused on organized sector workers. Under ta the APY, a guaranteed minimum pension of Rs.1,000/- or 2,000/- or 3,000/- or 4,000 or 5,000/- per month will be given at the age of 60 years depending on the contributions by the subscribers.

• Any Citizen of India can join the APY scheme. The following are the eligibility criteria: –

1. The age of the subscriber should be between 18 – 40 years.
2. He / She should have a savings bank account/ post office savings bank account.

The prospective applicant may provide Aadhaar and mobile number to the bank during registration to facilitate receipt of periodic update ates on the APY account. However, Aadhaar is not mandatory for enrolment.

The co-contribution of the Government of India is available for 5 years, i.e., from the Financial Year 2015-16 to 2019-20 for the subscribers, who join the scheme during the period from st June 2015 to 31s March 2016 and who are not covered by any Statutory Social Security Scheme and are not income taxpayers. The Governor-contribution button is payable to eligible Permanent Retirement Account Number (PRANs) by the Pension Regulatory and Development Authority (PFRDA) after receiving the confirmation from Central Record Keeping Agency to the effect that the subscriber has paid all the installments for the year Government co-contribution will be credited in subscriber’s savings bank account/ post office savings bank account 50% of the total contribution subject to a maximum of Rs 1000/- at the end of the financial year.

• The beneficiaries, who are covered under statutory social security schemes, are not eligible to receive Government co-contribution under APY. For example, members of the Social Security Schemes under the following enactments would not be eligible to receive Government co-contribution under APY:-

1. Employees’ Provident Fund and Miscellaneous Provision Act, 1952.
2. The Coal Mines Provident Fund and Miscellaneous Provision Act, 1948.
3. Assam Tea Plantation Provident Fund and Miscellaneous Provision, 1955.
4. Seamans’ Provident Fund Act, 1966.
5. Jammu Kashmir Employees’ Provident Fund and Miscellaneous Provision Act,1961.
6. Any other statutory social security scheme.

A Minimum guaranteed monthly pension of Rs 1,000/- or 2,000/- or 3,000/- or 4,000 or 5,000/- per month will be given from the age of 60 years onwards depending on the contributions by the subscribers.

The benefit of minimum pension under Atal Pension Yojana would be guaranteed by the Government in the sense that the actual realized returns on the pension contributions are less than the assumed returns for minimum guaranteed pension throughout the contribution. Such shortfall shall be funded by the Government. On the other hand, if the actual returns on the pension contributions are higher than the assumed returns for a minimum guaranteed pension, such excess shall be credited to the subscriber’s account, resulting in enhanced scheme benefits to the subscribers. The Government would also co-contribute 50% of the total contribution or Rs. 1000 per annum, whichever is lower, to each eligible subscriber, who joins the scheme during the period 1st June 2015 to 31s March 2016 and is not a beneficiary of any social security scheme and is not an income taxpayer. The government co-contribution will be given for 5 years from the Financial Year 2015-16 to 2019-20. At present, a subscriber under the National Pension System (NPS) is eligible to get tax benefits for the contribution, up to a ceiling, and even for the investment returns on such contributions. Further, the purchase price of the annuity on exit from NPS is also not taxed and only the pension income of the subscribers is part of normal income and taxed at the appropriate marginal rate of tax, applicable to the subscriber. It is proposed that similar tax treatment may be given to the subscribers of APY. However, presently, a similar tax dispensation, on par with that available under NPS, is yet to be accorded to subscribers under APY.

The contributions under APY are invested as per the investment guidelines prescribed by PFRDA for the Central Government / State Government / NPS-Lite / Swavalamban Scheme / APY.

1. Approach the bank branch/post office where the individual’s savings bank account is held or open a savings account if the subscriber doesn’t have one.

2. Provide the Bank A/c number/ Post office savings bank account number and with the help of the Bank staff, fill up the APY registration form.

3. Provide Aadhaar / Mobile Number. This is not mandatory but may be provided to facilitate communication regarding contribution.

4. Ensure keeping the required balance in the savings bank account/ post office savings bank account for the transfer monthly/quarter Lyerly / half yearly contribution.

It is not mandatory to provide an Aadhaar number to open an APY account. It is however desirable to provide an Aadhaar Number for proper identification of the subscriber.

The savings bank account/ post office savings bank account is mandatory for joining APY.

The contributions can be made at monthly/quarterly/half-yearly intervals through the auto debit facility in the savings bank account/ post office savings bank account of the subscriber.

The monthly/quarterly/half-yearly contribution depends upon the pension and the age of shuttered subscribers. The details may be referred to in Annex I.

The contribution may be paid to APY through a savings bank account/ post office savings bank account on any date of the month, in case of monthly contributions or any day of the first month of the quarter, in case of quarterly contributions, or any day of the first month of the half year, in case of half-yearly contributions.

The subscribers should keep the required balance in their savings bank accounts/ post office savings bank account on the stipulated due dates to avoid any overdue interest for delayed contributions. The monthly/quarterly/half-yearly contribution may be deposited on the first date of the month after a half year in the savings bank account/post office savings bank account. However there Indian quate balance in the savings bank account/ post office savings bank account of the subscriber till the last date of the month / last date of the first month in a quarter / last day of the first month in a half year, it will be treated as a default and contribution will have to be paid in the subsequent month along with overdue interest for delayed contributions. Banks are required to collect Rs. 1 per month for the contribution of every Rs. 100, or part thereof, for each delayed money contribution.

Overdue interest for delayed contribution for quarterly/half yearly mode of contribution shall be recovered accordingly. The overdue interest amount collected will remain as part of the pension corpus of the subscriber.

More than one monthly/quarterly/half-yearly contribution can be recovered subject to the availability of the funds. In all cases, the contribution is to be recovered along with the overdue charges if any. This will be e bank’s internal process. The due amount will be recovered as and when funds are available in the account.

The deduction would be made in the subscriber’s account for account maintenance charges and other related charges periodically. Once the account balance in the subscriber’s account becomes zero due to deductive account maintenance charges, fees, d overdue interest, the account would be closed immediately. For those subscribers, who have availed of Government co-contribution, the account would be treated as becoming zero when the subscriber corpus minus the Government-contribution would be equal to the account maintenance charges, fees, and overdue internet and hence the net corpus becomes zero. In this case, the Government contribution would be given back to the Government.

Table of all charges of APY

Yes. It is mandatory to provide nominee details in the APY account. If the subscriber is married, the spouse will be the default nominee. Unmarried subscribers can nominate any other persona as a nominee & they have to provide spouse details after marriage. The Aadhaar details of spouses and nominees may be provided.

A subscriber can open only one APY account and it is unique. Multiple accounts are not permitted.

The subscribers can opt to decrease or increase the pension amount during the accumulation phase, once a year. However, the switching option shall be available once a year during April.

1. On attaining the age of 60 years:

Upon completion of 60 years, the subscribers will submit the request to the associated bank for drawing the guaranteed minimum monthly pension or higher monthly pension, if investment returns are higher than the guaranteed returns embedded in APY. The same amount of monthly pension is payable to the spouse (default nominee) upon death the subsite nominee will be eligible for return of pension wealth accumulated till age 60 of the subs cribber upon the death of both the subscriber and spouse.

2. In case of death of the subscriber due to any cause after the age of 60 years:

In case of death of the subscriber, a pension would be available to the spouse and on the death of both (subscriber and spouse), the pension wealth accumulated till age 60 of the subscriber would be returned to the nominee.

3. Exit before the age of 60 Years:

Exit before 60 years of age is generally not permitted, it may be permitted by PFRDA only in exceptional circumstances, i.e., in the event of the death of a beneficiary or terminal disease, etc in line with the provisions for pre-mature exit under NPS.

In case a subscriber, who has availed off ed Government co-contribution under APY, chooses to voluntarily exit APY at a future date, he shall only be refunded the contributions made by him to APY, along with the net actual accrued income earned on his contributions (after deducting the account maintenance charges). The Government co-contribution, and the accrued income earned on the Government co-contribution, shall not be returned to such subscribers.

4. Death of the subscriber before 60 years:

The entire accumulated corpus under APY will be returned to the spouse/nominee.

However, the pension shall not be payable to the spouse/nominee.

The periodical information to the subscribers regarding activation of PRAN, balance in the account, contribution credits, etc. will be intimated to APY subscribers by way of SMS alerts. The subscriber will also be receiving a physical Statement of Account once a year.

The physical statement of the APY account will be provided to the subscribers annually.

The contributions may be remitted through auto debit uninterruptedly even in case of a change of residence/location.

The scheme is open to Indian citizens only. Hence, in that event, the APY account will be closed and the contribution will be returned to the subscriber as mentioned above in the case of voluntary exit before the age of 60 years.

1. Subscriber between the age group of 18 and 40:-

The subscriber would be automatically migrated to APY with an option to opt-out. The associated aggregator will facilitate those subscribers for completing the process of migration. The subscribers may also approach the nearest authorized bank branch/post office for shifting their Swavalamban account into APY with PRAN details.

The benefit of co-contribution of the Government of India for those subscribers of the Swavalamban Scheme who have migrated to APY would not exceed 5 years under both the Schemes. For example, if a Swavalamban beneficiary has received the benefit of Government co-contribution for 1 year, then the Government co-contribution to that subscriber under APY, after migration from the Swavalamban Scheme, would be available only for 4 years, and so on.

The existing Swavalamban beneficiary opting out of the proposed automatic migration to APY will be given Government co-contribution up to 2016-17, if he is eligible, and the NPS Swavalamban would continue till such people attain the age of exit under that scheme.

The accumulated corpus of existing Swavalamban subscribers between the age group of 18 and 40 years, who get migrated to APY will be kept under the same PRAN and remain as an additional wealth of the subscriber till the time of exit. This additional amount may be given to the subscriber as an enhanced pension benefit or as a lump-sum withdrawal. The contribution of such subscribers under APY, after migration from the Swavalamban Scheme to APY, would be as per the amount mentioned in Annex –I, depending on the pension amount selected and the age of the subscriber.

2. Subscriber above 40 years of age:-

The subscribers under the Swavalamban Scheme, who are beyond the age of 40 and who do not wish to continue under the Scheme, may opt-out by complete withdrawal of the entire amount in a lump sum or may prefer to continue till the age of 60 years, to be eligible for annuities there under.

Yes, the subscriber can change the mode (monthly/ quarterly/half yearly) of the auto-debit facility once a year during April.

No, a person who is in the age group of 18 years to 39 years 364 days can join Atal Pension Yojana.