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Atal Pension Yojana is a pension scheme introduced by the Government of India. The scheme pertains to citizens who belong to the unorganized sector, registered with the National Pension Scheme (NPS). The scheme was introduced in the year 2015 by the former Finance Minister Arun Jaitley. The pension scheme is administered by the Pension Fund Regulatory and Development Authority.

Eligibility of Atal Pension Yojana

The subscriber must meet the eligibility criteria mentioned in the points below to avail the benefits of Atal Pension Yojana:

  1. The subscriber must be a citizen of India, working for the unorganized sector.
  2. The entry age for subscribers is 18 years, with a higher limit of 40 years. Subscribers signing up for the scheme at the age of 40 years would have to contribute a higher amount towards the pension scheme.
  3. The applicants must have a valid mobile number, Aadhaar card and a bank account. They must link their Aadhaar number to their bank account.
  4. The contributions towards the scheme must be made for 20 years.

Key Features

Atal Pension Scheme revolves around the idea of making regular savings for the workers in the unorganized sector for them to enjoy financial security at old age.

Let’s take a look at the key features of this scheme:

  1. The subscribers of this scheme are eligible to receive assured pensions ranging from Rs. 1,000 to Rs. 5,000.
  2. 50% of contribution or Rs. 100 (whichever is lower) will be contributed by the Government of India in the pension account of the subscriber.
  3. The co-contribution to the scheme from the Government of India will be made available to subscribers who sign up for the scheme between June 1 and December 31, 2015.
  4.  Upon the subscriber’s death, his/her spouse is eligible to claim the pension amount.
  5. In the event of the subscriber’s death before the age of 60 years, the spouse can either claim the entire amount of pension or continue the scheme for the remaining period.
  6. The accumulated pension amount can be also claimed by the nominee in case both the subscriber and his spouse are dead.

Benefits of Atal Pension Yojana

The Atal Pension Scheme is an ideal scheme to invest in for people whose earning capacity is low. Workers in the unorganized sector mostly do not get the privilege of a steady income to maintain their standard of living after retirement. However, with small but regular investments in the Atal Pension Yojana, workers in the unorganized sectors can reap the benefit of incomes even after retirement.

Listed below are some of the major benefits of Atal Pension Yojana:

  1. The subscribers are notified for each contribution provided to the fund via SMS and also physical account statement.
  2. The cost of investment is low. The investments start as low as Rs. 42 per month for individuals aged 18 years and above.
  3. The scheme is linked to the subscriber’s bank account so that he may be able to access it from anywhere in the country.
  4. Pension Fund Regulatory and Development Authority (PFRDA) regulates the scheme which is a testimony to the safety and reliability of the scheme.
  5. The scheme comes with a tax benefit for the subscriber under Section 80 C. The subscriber is also eligible to get deductions up to Rs. 50,000 under Section 80 CCD (1B).

Contribution Chart for Atal Pension Yojana

The subscribers of the Atal Pension Scheme may contribute to the amount mentioned in the chart below. 

Entry Age

Remaining Years of Contribution

Installment to be paid monthly for Rs. 1,000 monthly pension

Installment to be paid monthly for Rs. 2,000 monthly pension

Installment to be paid monthly for Rs. 3,000 monthly pension

Installment to be paid monthly for Rs. 4,000 monthly pension

Installment to be paid monthly for Rs. 5,000 monthly pension

18

42

42

84

126

168

210

19

41

46

92

138

183

228

20

40

50

100

150

198

248

21

39

54

108

162

215

269

22

38

59

117

177

234

292

23

37

64

127

192

254

318

24

36

67

139

208

277

346

Frequently Asked Questions

  1. Can I sign up for the scheme without having a savings account?

No, subscribers to Atal Pension Yojana must have savings accounts to be eligible to benefit from the scheme.

  1. Is there a due date for monthly contributions?

Yes, subscribers must contribute to their pension account as per the date of the initial deposit.

  1. Can I withdraw funds from APY before the end of the tenure?

A subscriber may exit APY before the age of 60 years only in exceptional circumstances such as the death or terminal illness of the subscriber.

  1. Is there a fine for delay in the monthly contribution?

Yes, the subscriber must pay a fine up to Rs. 10 per month for delay in monthly contribution. For contributions up to Rs. 100 per month, the subscriber must pay Rs. 1 a fee for delayed contribution. Similarly, for contributions up to Rs. 500 and Rs. 1,000, the charge for the delay is Rs. 2 and Rs. 5 respectively. Subscribers’ contribution of more than Rs. 1,000 in a month must bear Rs. 10 as a late fee.

  1. What is the mode of contribution to the pension account?

The subscriber must enable the auto-debit facility in his savings bank account to be able to contribute to the APY fund.

Naval Goel is the founder of PolicyX.com. He is an Associate Member of the Indian Institute of Insurance`, Pune. He has been authorized by IRDA to act as a Principal Officer of PolicyX.com Insurance Web Aggregator.
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