Atal Pension Yojana Scheme, Features, Eligibility & Benefits

Atal Pension Yojana Scheme:- The Indian government supports and encourages working poor people to save for retirement because it is concerned about their ability to sustain themselves in old life. Its objectives are to reduce the hazards associated with long life among unorganized sector workers and to motivate them to voluntarily contribute to their retirement. Thus, in the 2015–16 Budget, the Indian government unveiled the Atal Pension Yojana (APY), a brand-new program. All citizens working in the unorganized economy are the aim of APY. Through the NPS structure, the Pension Fund Regulatory and Development Authority (PFRDA) is in charge of overseeing the program.

What is the Atal Pension Yojana Scheme?

• The Atal Pension Yojana (APY), a pension system introduced by the government, aims to provide social security for every Indian. It is specifically for the impoverished, disadvantaged, and unorganized workforce, such as gardeners, maids, and delivery boys. The APY scheme replaced the older, less well-liked Swavalamban plan.
• By guaranteeing that no Indian citizen has to worry about any illness, accident, or disease in old age, the initiative seeks to instill a sense of security. Employees in the private sector or those employed by companies that do not offer pension benefits are also eligible to apply for this program.
• Upon reaching the age of sixty, one can choose to receive a fixed pension of either Rs 1000, Rs 2000, Rs 3000, Rs 4000, or Rs 5000. The pension of an individual will be determined by their age and the total amount of contributions they have made. In the event of either subscriber’s death, the nominee will get the cumulative amount; in the event of both subscribers’ deaths, the subscriber’s spouse will be eligible to claim the pension. On the other hand, in the event that the subscriber passes away before turning sixty, the surviving spouse has the option to either leave the plan and receive the corpus or go on for the remainder of the term.

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Key Features of the Atal Pension Yojana Scheme:

• The Government of India launched the Atal Pension Yojana to give all Indians over 60 years of age a monthly pension. Its primary targets are unorganized sector workers, the impoverished, and the disadvantaged.
• The National Pension System (NPS) framework serves as the vehicle for PFRDA (Pension Fund Regulatory and Development Authority) regulation over it.
• From Rs 1000 to Rs 5000. A minimum pension of at least Rs. Subscribers will receive a guaranteed 1000 per month (in multiples of 1000).
• The Indian government will guarantee the minimum pension insofar as it will finance any gap if the actual return on pension contributions is less than the anticipated return for the minimum guaranteed pension over the contribution period.
• The benefits of the scheme will grow for subscribers if, during the contribution period, the actual return on pension contributions exceeds the predicted return for the minimum guaranteed pension.
• The subscriber will receive credit for this excess.
• For the first five years, the Government of India will additionally match 50% of the subscribers’ contributions, or Rs. 1000. will provide a co-payment of Rs. 10,000 annually, whichever is less.
• Contribution benefits last for five years, and the program is available to anybody who registers accounts between June 1, 2015, and March 31, 2016.

Eligibility:

• will be applicable to all Indian nationals who are between the ages of 18 and 40.
• Its principal KYC will be Aadhaar.
• It is possible to input the Aadhaar data later if they are not available at the time the account is opened.
• You can join APY as a bank account holder.

Who is not eligible?

According to the following criteria, the following people are not qualified for government assistance.

• who signed up for the plan on April 1, 2016, or after.
• whether he is subject to income tax.
• Does he have access to any social security or employee provident fund coverage?
• It is not possible for Non-Resident Indians (NRIs) to open an account.
• During the duration of the APS plan, an Indian citizen who becomes an NRI will have their account closed and receive full payment for any contributions and returns made on their behalf.

Atal Pension Yojana Scheme Benefits

One of the advantages of the Atal Pension Yojana is that it is open to private-sector employees as well. Members have the option to choose how much they contribute, as this also influences how much they receive back. When you reach the age of sixty, you will be eligible for a guaranteed pension of ₹1000|₹2000|₹3000|₹4000|₹5000. Should the subscriber pass away, their spouse or designee will get the pension amount. In addition, Section 80CCD of the Income Tax Act of 1961 qualifies you for a tax benefit.

The Pension Funds Regulatory Authority of India (PFRDA) is responsible for managing and allocating the total amount collected. In order to strengthen this program, the government announced that subscribers who signed up between June 1, 2015, and December 31, 2015, for a five-year term, would get a co-contribution of 50%, or ₹1000, annually.

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Exit:

• At the age of sixty, one may fully annuitize their primary fund or pension funds. The customer will have access to their pension upon withdrawal.
• Should the subscriber pass away, their spouse will be eligible for the pension; if the subscriber and spouse both pass away, the nominee will get the pension basic fund.
• Early withdrawal is permitted till the age of sixty. Users who have benefited from government co-contribution under the APY will not be eligible to receive government co-contribution, accrued income from government co-contribution, or net actual income from their contribution (after deducting account maintenance expenses).

How to apply for the Atal Pension Yojana?

To access APY, take these actions.

• This scheme is available at all nationalized banks. To initiate your APY account, you can go to any of these banks.
• Banks and online sources offer paperwork for the Atal Pension Yojana. The official website has the form available for download.
• In addition to English, there are forms accessible in Hindi, Bengali, Gujarati, Kannada, Marathi, Oriya, Tamil, and Telugu.
• Once filled out, submit the application to your bank.
• If you haven’t given the Bank your current cellphone number yet, kindly supply it.
• Send in a copy of your Aadhar card.
• Upon approval of the application, you will receive a confirmation message.

How to withdraw from APY?

• Withdrawals from the APY plan are not allowed before the age of sixty. Exceptional circumstances, such as a beneficiary’s death or terminal illness, may allow withdrawals. Thus, these are the real departure scenarios:
• Reaching the age of sixty: Pension amount annuitized 100% to the subscriber
• Death of subscriber: In the event of the subscriber’s spouse’s passing, the nominee will get a pension.

penalty for default

In the event that you miss a payment, your bank will deduct the following amount from your payment:

• once more. Up to Rs. 100 in monthly donations, contributions start at Rs. 1.
• once more. 2.101 to 500/-per month for contributions made in excess of that amount.
• For contributions between Rs 501/- and Rs 1000/-per month, there is a monthly fee of Rs 5.
• For contributions over Rs 1001/-per month, there is a monthly fee of Rs 10.

Important facts to know about APY

• Due to the fact that you will be making regular donations, the funds will be automatically taken from your account. Before every debit, you have to make sure that your account has enough money in it.
• You are free to raise your premium whenever you like. All you need to do is visit your bank, speak with your manager, and make the required adjustments.
• You will be assessed a penalty if you miss a payment. A monthly penalty of one rupee for each rupee contributed. 100 or a portion of it. In the event that you fail to make payments for a complete year, the customer will receive a reimbursement of the outstanding balance upon account cancellation.
• Early withdrawals are not considered. Only in cases like death or terminal illness would the customer, or his designee, receive a full refund.
• If you end the plan before reaching 60 for any reason, the only money you will receive back is your investment and any interest that has accumulated. Interest generated on that sum, as well as the government co-contribution, will not be available to you.

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FAQ’s

Q. How can I apply online for APY?

Ans- No, there isn’t yet a way to apply for APY online. You must fill out the form by visiting your bank.

Q. When applying for the APY Scheme, what documentation is required?

Ans- You must fill out the application and send in a photocopy of your Aadhar card in order to apply for the APY scheme. No additional paperwork is needed.

Q. How will I know if there has been activity on the pension plan?

Ans- You will get an SMS alert on the registered phone number you supplied as soon as the pension plan is enabled.

conclusion

For people who work in the private sector or in companies without pensions or other retirement benefits, the Atal Pension Yojana (APY) is quite helpful.

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