Atal Pension Yojana (APY) is a government-backed pension scheme for the unorganised sector workers who are neither under any social security scheme nor income taxpayers. This scheme was originally launched in 2010-11 by the name of Swavalamban Yojana while in 2015 Government of India relaunched it by the name of Atal Pension Yojana. This scheme is administrated by Pension Fund Regulatory and Development Authority of India (PFRDA) under its National Pension Scheme (NPS) architecture.
Any Indian citizen from unorganised sector who lies in the age group of 18 to 40 years is eligible to join the scheme through its bank account or post office account. A monthly pension of 1,000 or 2,000 or 3,000 or 4,000 or 5,000 will be provided to the subscriber after attaining the age of 60 years. The amount of monthly pension will depend on his/her contribution and age at the time of joining the scheme.
How can the contribution be done?
While joining the Atal Pension Yojana the subscriber is free to choose whether he/she wants to pay monthly, quarterly or half yearly instalments which will be deducted from his/her account directly by auto debit facility at the first date of month or first date of the first month of quarter or at the first date of half-yearly period. The subscriber is free to change the amount he/she wants to contribute anytime but this facility will be available only once a year in the month of April.
What if subscriber dies before attaining the age of 60 years?
If the subscriber dies before attaining the age of 60 years, his/her spouse will be eligible to get the same amount of pension provided he/she pays the instalments till the time the original subscriber would have attained the age of 60 years, e.g. if the subscriber dies at an age of 55 years then his/her spouse have to pay instalments for 5 more years to receive the monthly pension. And if both the original subscriber and spouse of the subscriber dies before the age of 60 years, then the nominee is entitled to receive the total amount contributed in the scheme plus interest accumulated minus the operating or service charges if any.
Is Government contributing anything?
Yes, the Government is contributing 50 per cent of the yearly payment or 1,000 rupees (whichever is less) for the initial period of 5 years (from 2015-16 to2019-20), only for those who joined the scheme between 1 June 2015 to 31 March 2016.
Is there an option to opt out before the age of 60 years?
Yes, the subscriber can opt out from the scheme before attaining the age of 60 years. In this case, he/she will be paid his/her total contributed amount plus the interest accrued minus the service/operating charges. The important thing to note here is that in this case the money contributed by the government will not be paid to subscriber nor even the interest on that amount. It will be transferred back to the government.