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Atal Pension Yojana

APY Scheme

Last Updated 15th Jun 2021

  • Atal Pension Yojana was launched in 2015 to provide a monthly source of income to those who have not enrolled in any prior pension scheme.
  • The pension to be generated under the APY scheme depends on the contributions made by the beneficiaries.
  • An individual who is in the age range of 18 years to 40 years is eligible for the scheme.
  • Beneficiaries can enjoy tax benefits under section 80CCD of the Indian Income Tax Act.
  • The government-backing makes the APY scheme a risk-free investment option.
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What is Atal Pension Yojana (APY)?

The APY full form is Atal Pension Yojana which is a Government affiliated scheme that individuals can make investments and receive a monthly pension from the accrued corpus after retirement. In the absence of the beneficiary, a spouse can avail the benefits, and in the absence of both, the nominee can receive the corpus in a lump sum. The Atal Pension Scheme aims to provide an income in the form of pension to those belonging to the unorganised employment category. However, individuals belonging to the organised employment category with no access to any pension facility can also be beneficiaries under this pension yojana. 

The Indian Government launched the Atal Pension Yojana in 2015 as a replacement of the previous Swavalmban Pension Yojana and as a component of the National Pension Scheme. Individuals invested under the Swavalamban scheme prior to 2015 are eligible for the new pension scheme and are automatically transferred under the APY scheme. The Pension Funds Regulatory Authority of India regulates the APY scheme. The Indian Government made co-contribution to the accounts opened in 2015.

Objective of Atal Yojana

The objectives of APY scheme are listed as follows :-

  • Provide financial security to the individuals at the time of retirement.
  • Encourage the habit of saving at an early age
  • The scheme is aimed at the unorganized sector in the country

Atal Pension Yojana Eligibility

Only the following individuals will be considered eligible as beneficiaries under the APY scheme.

  • Indian citizen.
  • Individuals falling under the age category of 18 years to 40 years.
  • Individuals holding an active mobile number.
  • Individuals holding valid bank accounts linked to valid Aadhaar number.
  • Individuals not availing benefits under any other social welfare program.

Individuals willing to invest under the Pension Yojana are bound to contribute for at least 20 years and must present all details required for KYC.

Atal Pension Yojana Features and Benefits

Below goes the set of features and benefits of the Atal Pension Yojana scheme.

  • Flexible contribution: The contributions made under the APY scheme determine the monthly pension amount. Beneficiaries may feel the need to or become equipped to make more contributions in order to receive a higher amount of pension or vice versa. The Funds Regulatory Authority of India acknowledges the need and allows the beneficiary to increase or decrease the contribution amount once per year.
  • Age limitation: As stated earlier, individuals must belong to the age category of 18 years to 40 years for being eligible under the pension scheme. The reason behind the maximum age limit of 40 years is the obligatory tenure of the scheme, i.e., 20 years.
  • Withdrawal policies: Beneficiaries can close the scheme only after reaching the age of 60. Once the age has come, beneficiaries can close the scheme and start receiving monthly pensions. No premature withdrawal is allowed under this scheme. At the demise of the beneficiary, the scheme is transferred to the spouse or to the nominee in the absence of a spouse.
  • Regular source of income after retirement: This scheme generates a monthly income once an investor reaches the age of 60. Hence, it provides a sense of financial security after retirement to those who do not have access to any other pension scheme.
  • Delay in contribution and related penalty: In cases of delay in the contribution, the beneficiaries will be subject to penalty.

Atal Pension Yojana Benefits:-

  • Sovereign backing: The Atal Pension Yojana is operated by the Pension Funds Regulatory Authority of India and thus has sovereign backing. It ensures guaranteed returns and eliminates the risk factors related to investments. 
  • Easily transferable: This pension yojana allows a spouse to avail the benefits of the scheme after the demise of the beneficiary. The spouse can either opt for the regular monthly payout or collect the corpus in a lump sum. In the absence of a spouse, the scheme will be transferred to the nominee. 
  • Tax benefits: Section 80CCD of Indian Income Tax Act of 1961 has provided the Atal Pension Scheme with a couple of tax benefits. Sub-section 1 of section 80CCD allows tax exemptions up to 10% of a maximum income up to ₹ 1.50 Lakh. Sub-section 1B of section 80CCD offers an additional tax exemption of ₹ 50,000 . The aim behind furnishing the tax benefits under the Atal Pension Yojana benefits is to ensure no disturbance to the monthly source of income of the beneficiaries by reducing their taxable income.

Monthly Contribution for Atal Pension Yojana

The age of the applicant at the time of entry, the entire corpus and the desired monthly payouts are the key influencing factors for the monthly contribution under the Atal Pension Yojana. The Atal Pension Yojana chart of the monthly contribution is given below for better understanding.

Entry Age
(In Years)
Years of Contribution Monthly Pension – ₹ 1,000 | Indicative Return of Corpus – ₹ 1.70 Lakh Monthly Pension – ₹ 2,000 | Indicative Return of Corpus – ₹ 3.40 Lakh Monthly Pension – ₹ 3,000 | Indicative Return of Corpus – ₹ 5.10 Lakh Monthly Pension – ₹ 4,000 | Indicative Return of Corpus – ₹ 6.80 Lakh Monthly Pension – ₹ 5,000 | Indicative Return of Corpus – ₹ 8.50 Lakh
18424284126167210
19414692138183228
204050100150198248
213954108162215269
223859117177234292
233764127192254318
243670139208277346
253576151226301376
263482164246327409
273390178268356446
283297194292388485
2931106212318423529
3030116231347462577
3129126252379504630
3228138276414551689
3327151302453602752
3426165330495659824
3525181362543722902
3624198396594792990
37232184366548701097
38222404807209571196
392126452879210541318

Study the Atal Pension Yojana chart thoroughly and then opt for the investment best suited for your requirements.

Important Facts to know about APY

Here are few of the important facts about atal pension yojana:-

  • APY is a guaranteed pension scheme offered by government of India
  • Pension account can be opened by an Indian citizen who has an bank account
  • Subscriber will receive pension of ₹ 1,000, ₹ 2,000, ₹ 3,000, ₹ 4,000 and ₹ 5,000 at the age of 60
  • Monthly contribution flexibility is possible once a fiscal year
  • The deposit amount varies with every age category
  • The subscriber has to maintain the installment balance on savings account

How to Apply for Atal Pension Yojana?

The process of applying for Atal Pension Yojana has been elaborated below.

  • Collect the Atal Pension Yojana scheme from your preferred bank or download the form online from the websites of the banks.
  • Fill up the form with correct details and submit at the bank along with photocopies of Aadhaar card.
  • Once approved, a confirmation message will be generated to the provided mobile number.

The application form for APY is available in English, Bangla, Marathi, Tamil, Telegu, Gujrati, Odia and Kannada. You can collect the form as per your language preference. The SMS facility can be availed for APY statement as well. You can opt for the SMS alert on the mobile number registered under your account. A periodic APY statement will send to the number containing details and status of your account. 

How to Download and fill Atal Pension Yojana form

Atal Pension Yojana form can be downloaded using any of the following ways:-

  • Visit the nearest bank branch of the participant bank
  • Visit the official website of participant bank and download the form
  • Open an account with Pension Fund Regulatory and Development Authority (PFRDA) and get a form printed

Atal Pension Yojana Withdrawal Procedure

An individual can withdraw the money by visiting the bank branch only under the following conditions:-

  • When he/she turns 60 then whole annuitzation amount can be withdrawn
  • Before 60 it can be withdrawn only under unfortunate conditions like terminal disease or death. In case APY subscriber dies then his/her spouse will get the pension or nominee will receive

Atal Pension Yojana Penalty Charges

The penalty amounts charged for delay in contributions are as follows:-

Monthly ContributionPenalty for delay
Up to ₹ 100 ₹ 1
From ₹ 101 to ₹ 500 ₹ 2
From ₹ 501 to ₹ 1,000 ₹ 5
₹ 1,001 and more₹ 10

Other Pension Schemes

Here are few best pension plans in India in 2021:-

Scheme Name Entry Age
LIC Jeevan Akshay 6 Plan 30 years-85 years
Aditya Birla Sunlife Empower Pension Plan 25 years- 70 years
SBI Life Saral Pension Plan 18 years-65 years
HDFC Life Click2Retire 18 years-65 years
HDFC Life Assured Pension Plan 18 years-45 years
ICICI Pru- Easy Retirement 35 years-70 years
Reliance Smart- Pension 45 years-75 years
Bajaj Life Long Goal Pension Scheme 18 years-65 years
Bajaj Allianz Pension Guarantee 37 years-80 years
Max Life Forever Young Pension Plan 30 years-65 years

Atal Pension Yojana Form

To enroll yourself for the APY scheme you will have to fill the given form. The form can be downloaded from NSDL website or nearest bank’s branch that offers this scheme.

Atal Pension Yojana

FAQs

What is the age limit for APY?

The minimum age limit for APY is 18 years. Since one must make contributions for a minimum of 20 years and the investment comes to maturity when one reaches the age of 60, the maximum age limit for the pension scheme is 40 years. 

Is Atal Pension Yojana good?

Atal Pension Yojana is good, especially for those with no access to any pension scheme. The flexible contribution amount and the liberty of increasing or reducing the contribution amount in the middle of the tenure make it easy to operate. Moreover, the government backing makes it a risk-free investment option. 

What are the documents required to apply for the APY Scheme?

To apply for the APY scheme, identity proof, address proof and a document containing the date of birth are required. One can submit a copy of the Aadhaar card along with the application form, and no other document will be required.

Who is not eligible for Atal Pension Yojana?

The following individuals are not eligible for Atal Pension Yojana.

  • Not an Indian citizen.
  • Individual below 18 years or above 40 years.
  • Individual with no active mobile number and valid Aadhaar number.
  • Individuals already beneficiary under one pension scheme.

Is it possible to have more than one pension account under APY scheme?

No, it is not possible to have more than one pension account under the APY scheme.Each individual has an unique APY account.  

Is APY eligible for tax deduction?

The APY enjoys tax benefits under 80CCD section of the Income Tax Act of 1961, and it includes the additional tax deduction of ₹ 50,000 .

Can I withdraw money from APY?

APY generates monthly pension once the beneficiary reaches the age of 60. Before this age, you cannot withdraw any money from the scheme. 

How to Fill Atal Pension Yojana Form?

Download the form from the NSDL website and then the form has to be filled in BLOCK LETTERS. Information like personal details, pension details, give declaration and authorisation and section Acknowledgement - Subscriber Registration for Atal Pension Yojana (APY) will be filled by the bank.


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