Atal Pension Yojana (APY): Form, Benefits & Details to know!

This post will clear all your doubts on a popular saving scheme: Atal Pension Yojana. You will become aware of the features, benefits, eligibility for opening an APY account.  Also, know minute details like filling APY form, monthly premium plans and how to open an Atal Pension Yojana account in an easy manner.

What Is Atal Pension Yojana? Benefits

The Indian Government introduced Atal Pension Yojana as an opportunity for unorganized Indian society to join National Pension System. Before this scheme, the workers of the unorganized sector could not save their income for their retirement. This scheme works under PFRDA (Pension Fund Regulatory and Development Authority), a section of National Pension System (NPS).

The Government had serious concerns about old age income security of weaker section of society. This scheme aims to encourage people to opt for pension. Unlike other pension schemes, the workers from the private sector can also apply for Atal Pension Yojana.

Precisely, this scheme assists weaker sections of society to save income for old age. The subscribers will receive guaranteed monthly pension. According to the scheme, the subscriber will start receiving the pension after the age of 60. The amount of pension depends upon the percentage of contribution and tenure. 

Atal Pension Yojana: Key Features

Following are the key elements of this scheme:

• The subscriber will receive fixed monthly pension Of Rs. 1000 – Rs. 5000, after the age of 60.

• If the subscriber has died, the spouse will receive the same amount of pension until the death.

• In a case of death of subscriber and the spouse, the nominee will be entitled to receive accrued pension amount.

• The amount of fixed pension varies as per the contribution made previously.

• To gain the maximum benefit, the subscriber should start to contribute at the age of 18, till the age of 40.

• The maximum tenure for contribution is 20 years or above.

What Is The Contribution Amount For Atal Pension Yojana?

If you are a new subscriber with an age of 18, you will have to pay Rs. 42 per month for Rs. 1000 pension amount. The amount of pension varies according to the contribution and tenure. Different APY offers different pension amounts. We will see this section in detail as you continue reading.

This scheme offers a convenient option for auto-debit facility. This will connect your bank to pay contribution monthly.

In case you have stopped paying the contribution, you can reactivate your account by paying interest and pending contribution amount for the missed period.

Hence, Atal Pension Yojana enables financial security for unorganized sector workforce !

How To Apply For Atal Pension Yojana Online?

The banks and authorized third parties offer Atal Pension Yojana forms online. Visit the website of the respective bank or third party to download the application form. Just download the form, fill in necessary details and submit the form with required documents to the bank. With necessary documents and completed form, one can easily open Atal Pension Yojana Account. You have the option to download the form only. Direct online submission of applications is not possible. You have to submit the form to the bank nearby. 

PFRDA now offers APY on eNPS (National Pension Scheme) platform that has made investing in this scheme quite easy. So, you can use the eNPS portal to register for APY provided you have your bank account number, AADHAR and a registered mobile number.

Atal Pension Yojana Application Form

To open the Atal Pension Yojana account, the subscriber has to submit the application form with mandatory documents. Aadhar card is the most suitable document to identify nominees, spouse, and beneficiaries to prevent disputes. For the convenience of subscribers, this form is available in different languages, including Hindi, English, Bangla, Telugu, Gujarati, Odia, Kannada, Tamil and Marathi.

Regardless of the language, the Atal Pension Yojana form contains following fields to be filled:

Once you have filled the form, you need to sign it before submitting to the bank. The form holds a section named with “Acknowledgement – Subscriber Registration For Atal Pension Yojana (APY).” You don’t have to fill that section. The bank is allowed to fill this section. Once the form is being processed, the bank will issue an acknowledgement receipt back to you. 

Eligibility For Atal Pension Yojana:

Indian residents are allowed to open an Atal Pension Yojana account. The following criteria should be met:

⦁    The subscriber age should be between 18 – 40 years.

⦁    The subscribers with valid saving accounts are allowed to open the account.

⦁    Every contributee should have a registered mobile number at the application time. 

Atal Pension Yojana Calculator:

Every subscriber has one common question about Atal Pension Yojana that: What is the amount to be invested for specific returns? A simple answer is that amount of pension is dependent upon age, tenure, and contribution. These three factors control the over calculation of pension amount. The amount you are going to receive after retirement is dependent upon the contribution you make today.

If you start making contributions at a younger age, the lesser contribution has to be paid. As you will have plenty of tenures to complete the scheme. On the other hand, if you start later; higher contributions have to be made. For instance, for fixed Rs. 1000 pension amount you have to pay Rs. 42 per month, if you start at the age of 18 years. On the other hand, for Rs. 5000 pension amount, you need to pay Rs. 1454 per month if you start at the age of 40 years.

Calculation of pension amount as per the tenure and contribution is complicated. An average person cannot do the math easily. That is why we have tables showing five premium plans of Atal Pension Yojana scheme. You can choose what is best for you!

Atal Pension Yojana Monthly Premium Plans:

The subscribers always have confusion about contribution amount, pension amount and tenure. Precisely, the scheme offers five different plans to the contributors. To keep you away from a headache, we have created the table for each plan. Each table explains contribution and pension amount as per the age and tenure.

1: For Fixed Pension Of Rs. 1000

2: For Fixed Pension Of Rs. 2000

3: For Fixed Pension Of Rs. 3000

4: For Fixed Pension Of Rs. 4000

5: For Fixed Pension Of Rs. 5000

What Are The Penalty Charges For Atal Pension Yojana?

The subscriber has to pay the contribution every month. The subscriber is not allowed to make any break during the tenure of 20 or above years. In case the subscriber has stopped contributing, the bank will apply penalty charges, stipulated by authorities. The penalty charges range from Rs. 1 to Rs. 10 per month. The fixed penalty or interest shall be deducted from the pension corpus of the contributor.

Penalty charges are dependent upon contribution amount as per following:

• Penalty amount of Rs. 1/month for contribution amount up to Rs. 100
• Penalty amount of Rs. 1/month for contribution amount up to Rs. 100
• Penalty amount of Rs. 2/month for contribution amount between Rs. 101 – Rs. 500
• Penalty amount of Rs. 5/month for contribution amount between Rs. 501 – Rs. 1000
• Penalty amount of Rs. 10/month for contribution amount above Rs. 1001

Apart from penalties, following measures will be taken in case of default:

• If payments are not made for six months, the account will get frozen.
• If payments are not made for twelve months, the account will be deactivated.
• If payments are not made for twenty-four months, the account will be closed permanently.

To prevent delay in payments; the banks are allowed to make requests on the due date until the payment is made. The first day of the calendar month is considered as a due date. But, banks have the option to collect payment on any day of a month. The banks collect payments on FIFO base. It means the earliest due payment will be deducted first, regardless of the penalty charges. The banks can collect more than one contribution if the account has enough funds.

How To Withdraw Pension from Atal Pension Yojana Account?

After the age of 60 years, the subscriber will be allowed to make withdrawals from the Atal Pension Yojana account. The amount of pension is fixed as per the contributions made previously. The pension amount will be released with 100% benefits.

In a case of special scenarios, like a death of subscriber before 60 years, the accrued pension amount will be handed over to spouse or nominee. A subscriber who has received co-contribution from the Government can exit from the scheme any time. In this situation, only the contribution of the subscriber will be refunded with interest earned on the amount. The co-contributed amount by Government will not be released. 

Atal Pension Yojana Scheme: Frequently Asked Questions (FAQs)

Although, we have reviewed necessary information about Atal Pension Yojana. Still, there are some questions, which are frequently asked by the people. We have answered few of them as below:

1. Are beneficiaries of other social security schemes are entitled to Atal Pension Yojana Indian Government Co-Contribution?

No, Government’s Co-contribution is not available for beneficiaries of all other statutory social security schemes.

2. What is the procedure to open an Atal Pension Yojana Account?

• The person has to get or download Atal Pension Yojana form.
• The person has to fill in the form with required details.
• Aadhar card and registered mobile number are needed.
• Lastly, the person has to submit the form to the respective bank. Auto-debit should be set in the bank account. So, a bank can collect contribution on a due date. It is recommended to have sufficient balance in the saving account for making contributions.

3. Is Adhaar Card compulsory to open an Atal Pension Yojana Account?

Yes, it is compulsory to provide Adhaar card number. APY form mandatorily asks for your Aadhar number. Aadhaar card is considered as the main KYC document, used by banks to verify your details.

4. Is saving account mandatory to open an Atal Pension Yojana account?

Without holding a saving account, one cannot register for Atal Pension Yojana account.

5. How do banks decide due date for contribution?

Usually, the due date for contribution is the first day of the calendar month. But it is based upon first contribution date.

6. Is it compulsory to provide details for nominees?

Yes, it is compulsory to provide details for nominees. Without making a nomination, you are not allowed to open the account. This is why Aadhaar card is used for identifying nominees.

7. How many accounts can a person open?

A single subscriber can open only one Atal Pension Yojana account. That account will be unique to him only.

8. Are members of Employees Provident Fund eligible to apply for Atal Pension Yojana Scheme?

Yes, the member of Employees Provident Fund can open an Atal Pension Yojana scheme.

9. Can we change the monthly contribution amount?

Yes, you have the option to increase or decrease the contribution amount as per the need. It can be done once in a year, during the month of April.

10. How can I check the Atal Pension Yojana account balance?

All subscribers receive statements for the status of accounts periodically. For instant information, you can get alerts on the registered mobile number provided in the application.

11. Can I continue making contributions in case of change of city of residence?

Yes, you can keep making contributions, regardless of the city of residence. As the contributions are made via pre-set auto-debits.

12. What happens if contributor becomes an NRI?

Atal Pension Yojana scheme is available for Indian residents only. In case, the subscriber becomes the NRI; the account will be closed. The accrued amount will be forwarded to the subscriber. This will be considered as voluntary exit before retirement. 

Atal Pension  Scheme: A Final Take

Atal Pension Yojana is an optimistic step of the Indian government to support weaker part of society. The workers of this section work hard but don’t get benefits like old age income security. In fact, they don’t have an opportunity to invest their small savings. That is why Atal Pension Yojana plan was introduced. With this scheme, the weaker section can invest and plan for their retirement.

Under this scheme, one can receive fixed pension amount of Rs. 1000 – Rs. 5000 as per the contributions made. The Indian Government took serious steps to encourage people for making savings via this scheme. The most significant step is Government’s Co-Contribution to the scheme. The government promised to contribute 50% of the amount for first five years. Although, the offer was limited till 31st December 2015, it still attracted huge part of society towards the scheme.

In short, Atal Pension Yojana or Scheme provides income security after retirement for the unorganized sector of a country!