Download App Download Icon

All You Need to Know About Atal Pension Yojana (APY) Administered by PFRDA

Atal Pension Yojana - Objective, Investment Scheme, Procedure

Atal Pension Yojana was launched on 9 May 2015 to create a universal social security system for all Indians. With a focus on the needy, the underprivileged, and the unstructured sector workers, Pension Fund Regulatory and Development Authority, i.e. PFRDA, oversees APY.

In this article, you will learn about the objectives, form download procedure, Atal Pension Yojana investment scheme, advantages of joining the Atal Pension Yojana scheme, benefits and characteristics, frequently asked questions, etc.

Every bank account user between the ages of 18 and 40 is eligible for Atal Pension Yojana, and the amount varies according to the selected pension amount. With the caveat that beginning on 1 October 2022, any citizen who is or has ever paid income taxes is unable to join Atal Pension Yojana.

The government would guarantee a minimal pension. This means that the Central Government would cover any shortfall if the contributions-based accumulated corpus generates a return on investment that is below expectations and insufficient to cover the minimum guaranteed pension.

Alternatively, the subscribers would receive improved pensionary benefits if the returns on investments were higher.

Atal Pension Yojana's Objectives

The Atal Pension Yojana's main objective can be summed up as the security and protection of citizens from accidents, diseases, and other harm. This program is primarily intended for the nation's unorganized sector.

APY Form Download Procedure

You can access the Atal Pension Yojana (APY) account opening form by using one of the following processes:

  • The application is accessible at the nearby branch office of any partner bank.
  • You can view and download the form from the participating banks' official websites if available.
  • From the official website of PFRDA, the Atal Pension Yojana account opening form can be downloaded.

How to Submit an Atal Pension Yojana Application

The steps indicated below must be done to profit from the scheme:

  • All nationalized banks offer the Atal Pension Yojana program. By visiting these institutions, anybody can open an APY account.
  • The bank websites also have online access to the account opening forms. Individuals can download the application form.
  • The application is available in official languages in English, Kannada, Odia, Telugu, Tamil, Marathi, Gujarati, and Bangla.
  • The application should be filled out and submitted at the bank.
  • A working cellphone number must be given.
  • You must give a duplicate of your Aadhaar card.
  • When your application is approved, you'll receive a confirmation text.

How to Fill the Atal Pension Yojana Form?

Filling out the Atal Pension Yojana Scheme form is easy once you have obtained it.

Step 1: Filling the form

Addressing the form to the Manager of the Branch is required. By phoning or going to the bank, you can learn the name of your branch manager. Enter the name and branch of your bank.

Step 2: Information about the Bank

Complete the form in capital letters. You must first provide your bank information. Type in the name, branch, and account number of your bank. This field must be filled out.

Step 3: Information about you

Choose if you are a "Shri," "Smt," or "Kumari" by checking the corresponding box. Married applicants must mention their spouse's name.

  • Type in your full name, birth date, and age.
  • Your mobile number, email address, and Aadhaar number should be provided.
  • Then you can suggest someone and specify how they are related to you. In the event of your passing, a nominee will receive your gift.
  • You must include the nominee's date of birth and legal guardian's name if they are minors.
  • You must also mention whether the nominee participates in any other legal, social security programs and whether they pay income taxes.

Step 4: Pension information

  • There are options on the form for APY contributions of INR 1,000, INR 2,000, INR 3,000, INR 4,000, and INR 5,000 toward your pension. You should leave the box below marked "Contribution Amount (Monthly)" empty because the bank will fill it in after determining how much you must pay each month to obtain the pension.
  • Your entering age will serve as the basis for the calculation. If your entry age is 25 years old, you will need to pay INR 151 per month for a pension of INR 2000.

Step 5: Authorise and Declare

There must be a date and location provided. You can use your thumbprint or your signature when acknowledging a document. By signing the contract, you certify your eligibility for the Atal Pension Yojana and your understanding of the program's conditions and terms.

You declare that everything you've written is true to the best of your knowledge. If the information has to be altered in any way, you will contact the bank straight away.

You also mention that you don't have any NPS accounts (National Pension System). Your responsibility will derive from any knowingly incorrect or false information submitted.

Step 6: The bank will finish this step.

The Atal Pension Scheme form's last section, headed "Acknowledgement - Subscriber Registration for Atal Pension Yojana (APY)," must be filled out by the bank.

It is a declaration from the bank that they would sign you up for the Atal Pension Yojana Scheme. When you submit the form, the bank employee will finish it.

Atal Pension Yojana Investment Scheme

Atal Pension Yojana returns are assured. Your funds are spread throughout a variety of investment categories, including the ones listed below:

Investment Type Investment Quantum 
Public Sector Securities 45% - 50%
Bank term deposits and debt instruments 35% - 45%
Equity and instruments connected to equity 5% - 15%
Securities Backed by Assets Up to 5%
Instruments of the Money Market Up to 5%

Criteria for the Atal Pension Yojana (APY)

The Atal Pension Yojana is open to the following individuals:

  • You need to be an Indian citizen.
  • You need to be between the ages of eighteen and forty to apply.
  • A valid mobile number.
  • Your Aadhaar no. needs to be linked to a valid bank A/C.
  • You must input your client information.
  • You must not have an APY A/C already.

Penalties for the Atal Pension Yojana

Subscribers to the Atal Pension Yojana plan are required to make regular, uninterrupted monthly contributions. If the endorser stops making contributions or stops paying the premium on time, the linked bank may levy penalty fees that are set by the government.

Additional penalty fees between INR 1 and INR 10 are assessed each month. The contributor's pension fund must include a portion of this fixed penalty or interest amount.

  • If the contribution is less than INR 100, a monthly INR 1 penalty will be assessed.
  • The penalty would be INR 2 each month if the contribution amount was between INR 101 and INR 500.
  • The penalty would be INR 5 each month if the contribution amount was between INR 501 and INR 1000.
  • The penalty would be INR 10 each month if the contribution amount was greater than INR 1001.

The following actions will be performed on Atal Pension Yojana accounts where payments have been suspended:

  • The subscriber's account will be blocked if the payments are not made for six months.
  • If the subscriber's account remains inactive for a full year, their subscription will be canceled.
  • The subscriber's account will be permanently canceled if the payment is not received for twenty-four months.

The Atal Pension Yojana module would continually nudge the subscribers on the given deadline till they complete the payment to avoid late or postponed payments. The monthly payment is typically collected on the first day of the month, though the relevant bank is also allowed to recover the required contribution amount on any other day of the month.

The sum of the monthly contribution will be paid out using a FIFO approach, meaning that the set penalty costs and the amount that was previously past due will be paid out first.

If the subscriber has the required funds, the concerned bank also has the possibility to reclaim several contributions within a single month. The fixed monthly due payment will also be given to the bank.

Advantages of Joining the APY Scheme

Atal Pension Yojana (APY) is one of the best social security initiatives the government launched in 2015–16. The Atal Income Yojana program allows participants to make contributions to their accounts up until the age of sixty in exchange for a monthly pension.

This is advantageous because it gives people an assured minimum pension amount to cover their expenses after they turn sixty. Anyone who wants to register an account under the Atal Pension Yojana can easily grasp it because of its relatively straightforward layout.

All major banks provide the program for consumers who desire to open accounts under the program. The program is based on deposits made by the depositor until the age of sixty.

The Pension Fund Regulatory and Development Authority oversees the program (PFRDA). The following are the various Atal Pension Yojana benefits to be aware of:

Death Benefits

The contributor's spouse is entitled to Atal Pension Yojana death benefits. The spouse, who is the default nominee, immediately receives the pension upon the contributor's passing. If both the contributor and the spouse pass away, the nominee will get the predetermined corpus amount for the specific pension slab.

Suppose the contributor passes away before turning 60. In that case, the spouse can either keep the Atal Pension Yojana account open and receive benefits or liquidate the account and collect the contributions and gains made.

Retirement Advantages

The retirement benefit is the primary Atal Pension Yojana benefit. The monthly pension amount will be determined by the APY contribution made.

The pension payments range from INR 1,000 to INR 2,000, INR 3,000 to INR 4,000, and INR 5,000. Different contribution levels apply to these pension plans. The spouse is given a pension after the subscriber's passing.

Benefits of Taxes

The government is providing tax benefits on donations made to the APY to encourage people to invest in the program. To the extent of INR 50,000 more and above INR 1.5 lakh, the APY tax benefits may be obtained under Section 80CCD (1B), which will aid in lowering the subscriber's taxable income.

Atal Pension Yojana Characteristics

The following are the primary characteristics of the APY scheme:

  • The Indian government guarantees the minimal pension that would be given to the retiree.
  • Individuals have the right to Atal Pension Yojana tax benefits for their contributions to the program under Section 80CCD.
  • Anyone with a bank account is qualified to participate in the APY program.
  • Once someone turns sixty, they will begin getting a pension.
  • Employees in the private sector who do not receive pension benefits can apply for the Atal Pension Yojana program.
  • At the age of 60, subscribers will start receiving the guaranteed minimum monthly pension of INR 1000, INR 2000, INR 3000, INR 4000, or INR 5000.
    If you pass away while the plan is in effect, your spouse may either claim the contributions or finish the plan's term.
  • The subscriber will be eligible for a monthly pension, followed by their spouse. Following their death, the subscriber's nominee will receive the pension capital, which stood at 60.
    Suppose a subscriber passes away too soon (before turning sixty). In that case, their spouse may continue contributing to their APY account for the remainder of the vesting term until the original subscriber becomes sixty.
  • On a monthly, quarterly, or half-yearly basis, subscribers can make contributions to APY. Upon deducting the Government co-contribution and return/interest thereon, subscribers may voluntarily withdraw from the APY subject to specific restrictions.

Procedure for Withdrawing from the Atal Pension Yojana

Although this scheme originally did not allow withdrawal before the age of sixty, the APY withdrawal process has indeed been slightly altered:

  • You can leave this program with a full pension annuitization if you are sixty years old or older. You must visit the bank to apply for your pension.
  • Only exceptional circumstances, such as terminal sickness or death, will allow you to quit the program before reaching the age of sixty.
  • If you die before reaching the age of sixty, your spouse will obtain the pension. If both you and your husband died, the pension would be given to the nominee.

Conclusion

The Atal Pension Yojana is primarily intended for the nation's unorganized sector. The government is providing tax benefits on donations made to the Atal Pension Yojana as a way to encourage people to invest in the program.

Frequently Asked Questions (FAQs)

Who does not qualify for the Atal Pension Yojana?

All Indian citizens are eligible for the APY program. The following are the eligibility requirements:
(i) The subscriber's age should be between 18 and 40 years.
(ii) They should have a bank account with the postal service.

What steps must I take to open an Atal Pension Yojana account?

Register by completing the Atal Pension Yojana form. Give both a working cellphone number and your Aadhaar number. Afterward, hand in the APY form to the bank and set up automatic withdrawals from your account. Make sure your account has enough money in it for frequent contributions.

Who is eligible to join APY?

Any Indian citizen can participate in the APY scheme. The following are the eligibility requirements:
(i) The subscriber should be between eighteen and forty years old.
(ii) They should have a savings account/post office savings account.
During registration, the potential applicant may supply Aadhaar and a cellphone number to the bank to receive periodic updates on the APY account. However, Aadhaar is not required for enrollment.

Is it necessary to include the Aadhaar number when registering for this scheme?

While the Aadhaar number isn't needed while signing up, the Aadhaar card will be the primary KYC document required by banks to identify beneficiaries, nominees, and the subscriber's spouse.

How would my account be affected if I turned into an NRI?

The only person who may open an Atal Pension Yojana account are nationals of India. The account will be terminated should you turn into an NRI. You will get the accrued contribution amount, which will be seen as a decision to leave the program before turning 60.

Never miss a trading opportunity with Margin Trading Facility

Enjoy 2X leverage on over 370+ stocks

images