Atal Pension Yojana (APY) – Everything you need to know, Apply Now

Atal Pension Yojana (APY) was formerly known as Swavalamban Yojana. This government-backed pension scheme was launched for the workers of unorganised sector in India. Finance Minister Arun Jaitley mentioned about this scheme in the year 2015 Budget speech. On 9 May 2015 Prime Minister Narendra Modi launched this scheme in Kolkata.

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All citizens in the unorganized sector who joined the National Pension Scheme (NPS) administered by the Pension Fund Regulatory and Development Authority (PFRDA) Act 2013 can apply for this scheme. This pension scheme was named after former prime minister of India Atal Bihari Vajpayee.

Benefits of Atal Pension Yojana:

The Atal Pension Yojana or APY is one of the safest pension plans as it has been structured in a very simple way. Any subscriber who opens the bank account under this scheme can understand this scheme very easily. The employees of the private sector can avail the benefits of this scheme. Subscriber can also choose the contribution amount as per their requirement. Here below we have discussed the benefits of Atal Pension Yojana.

  • Retirement benefits:

This is the main objective of this Atal Pension Yojana. On attaining the age of 60 years the subscribers will get he guaranteed pension amount of Rs. 1000/-, Rs 2000/-, Rs. 3000/-, Rs. 4000/- or Rs. 5000/- based on the contributions made by them. After the unfortunate demise of the subscriber the pension amount will be given to the spouse or the nominee of the subscriber.

  • Tax Benefits:

The Atal Pension Yojana also offers Tax benefits under section 80CCD of the Income Tax ACT. Along with this the subscriber will also get the guaranteed return. The pension fund authority and regulatory fund of India will distribute and manage the entire accumulated fund.

  • Death benefits:

After the death of the subscriber the spouse of the subscriber can avail the death benefits of this plan. The pension will be automatically given to the default nominee (Spouse). A predefined accumulated amount for the particular pension slab will be given to the nominee after the demise of the subscriber and the spouse. But if the subscriber demise before the age of 60 years, then the spouse can close the account for receiving the accumulated fund or can also continue the APY account for receiving the pension after 60 years.

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Every individual can financially secure their life after retirement through availing this Government backed safest pension plan.

Need for Atal Pension Yojana:

A people will get a monthly income when they are no longer earning through pension scheme. There are some reasons behind the need for pension.

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  • With increasing age, the income earning potential will be decreased.
  • The cost of living has been raised a lot.
  • Longevity has been increased.
  • Nuclear family-migration of earning member has been raised.
  • You will get assured monthly income in old age.

Eligibility criteria for Atal Pension Yojana:

Before applying for this pension scheme, you must check out the following mentioned eligibility criteria for applying.

  • The subscriber must be between 18 – 40 years of age.
  • The subscriber must have a savings bank account/ post office savings bank account.
  • In order to facilitate receipt of periodic updates on APY account the applicant may have to provide Aadhaar and mobile number to the bank during registration.
  • Aadhaar is not mandatory for enrolment.

How to Apply for Atal Pension Yojana:

Check out the below mentioned points for applying the Atal Pension Yojana.

  • The subscriber has to visit the bank branch/post office where individual’s savings bank account is held.
  • In case the subscriber doesn’t have any bank account then open a savings account first.
  • Then he or she has to Provide the Bank A/c number/Post office savings bank account number.
  • Then fill the form of Atal Pension Yojana registration form with the help of the bank stuff.
  • Please make sure to keep the required balance in the savings bank account/post office savings bank account for transfer of monthly/quarterly/half yearly contribution.

Mode of Contribution:

The subscriber can contribute at monthly/quarterly/half yearly intervals through auto-debit facility from savings bank account/post office savings bank account. The monthly/quarterly/half yearly contribution will depend upon the intended/desired monthly pension and the age of subscriber at entry. The contribution may be paid on any date of the particular month to APY through savings bank account/ post office savings bank account.

Withdrawal procedure for Atal Pension yojana scheme:

  • Upon attaining the 60 years of age:

In case the investment returns are higher than the guaranteed returns embedded in APY then the subscriber can submit the request to the associated bank for drawing the guaranteed minimum monthly pension or higher monthly pension upon completing 60 years of age. After the death of subscriber, the same amount of monthly pension will be given to spouse (default nominee). After the death of both the subscriber and spouse the Nominee will be eligible for return of pension wealth accumulated till age 60 of the subscriber.

  • Exit before 60 years of age:

If a subscriber wants to voluntarily exit APY at a future date after availing Government co-contribution under APY then along with the net actual accrued income earned on his contributions (after the deduction of the account maintenance charges) he will be refunded the contributions made by him to APY. The subscriber will not get any refund of The Government co-contribution, and the accrued income earned on the Government co-contribution.

  • Death of the subscriber after the age of 60 years:

The spouse will get the same pension after the death of the subscriber after the age of 60 years. But after the death of both of them (subscriber and spouse) the nominee will get the pension wealth accumulated till age 60 of the subscriber.

  • Death of the subscriber before the age of 60 years:

After the death of the subscriber before 60 years, the spouse of the subscriber will get the option to either continue contribution in the APY account of the subscriber, which can be maintained in the spouse’s name, for the remaining vesting period, till attaining the age of 60 years of the subscriber. The spouse of the subscriber will receive the same pension amount as the subscriber until death of the spouse.

The spouse can also withdraw entire accumulated corpus under APY.

Important facts about Atal Pension Yojana:

Besides the above mentioned informations you have to check out these important features also.

  • A Subscriber can have only one unique bank account. Multiple accounts are not allowed.
  • A subscriber must provide nominee details in APY account. The spouse will be the default nominee for a default subscriber. Unmarried subscriber has to mention other person as nominee or have to provide spouse details after marriage. They have to provide the Adhar details of the nominee.
  • Only Indian citizen can avail this scheme.
  • The subscriber will get the physical statement of APY annually.
  • The mode (monthly/quarterly/half yearly) of auto debit facility can be changed by the subscriber once in a year during the month of April.
  • In case of change of residence/location the contribution may be remitted through auto debit uninterruptedly.
  • Subscribers will get informations regarding activation of PRAN, balance in the account, contribution credits etc. by way of SMS alerts.
  • The subscribers will get physical statement of Account once a year.
  • During the course of accumulation phase, once a year the subscriber can decrease or increase pension amount.
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