Atal Pension Yojana -
Atal Pension Yojana is a government-backed pension scheme in India targeted at the unorganized sector. Name after the ex-prime minister of India, Atal Bihari Vajpayee, Atal Pension Yojna is also known as APY. It was formally launched by Prime Minister Narendra Modi on 9 May in Kolkata. It was originally mentioned in the 2015 Budget speech by Finance Minister Arun Jaitley in February 2015. As of May 2015, only 11% of India's population has any kind of pension scheme, this scheme aims to increase the number.
· Overview of Atal Pension Yojana -
In Atal Pension Yojana, for every contribution made to the pension fund, The Central Government would also co-contribute 50% of the total contribution or ₹1,000(US$15) per annum, whichever is lower, to each eligible subscriber account, for a period of 5 years. The minimum age of joining APY is 18 years and maximum age is 40 years. The age of exit and start of pension would be 60 years. Therefore, minimum period of contribution by the subscriber under APY would be 20 years or more.
Aadhaar would be the primary KYC document for identification of beneficiaries, spouse and nominees to avoid pension rights and entitlement related disputes in the long-term. The subscribers are required to opt for a monthly pension from Rs. 1000 – Rs. 5000 and ensure payment of stipulated monthly contribution regularly. The subscribers can opt to decrease or increase pension amount during the course of accumulation phase, as per the available monthly pension amounts. However, the switching option shall be provided once in year during the month of April.
This scheme will be linked to the bank accounts opened under the Pradhan Mantri Jan Dhan Yojana scheme and the contributions will be deducted automatically. Most of these accounts had zero balance initially. The government aims to reduce the number of such zero balance accounts by using this and related schemes.
· Benefits of Atal Pension Yojana -
§ Subscribers of APY will get monthly pension after they reach the age of 60 years. If someone joins at the age of 18 years and contributes Rs.42 till he reaches 60 years, then monthly pension received would be Rs. 1,000.
§ Pension amount will range from Rs.1,000 – Rs. 5,000.
§ Auto-debit facility will also be provided. With this monthly contribution would be automatically debited from the subscriber’s account.
§ In case of death of the pensioner (father), the monthly pension would continue to be paid to the wife. And to the child (if both father and mother die).