Atal Pension Yojana (APY) is an old age income security scheme for all the savings account holder between age group 18-40. The scheme also address the longevity risks among the workers in unorganized sector and encourages the workers to voluntarily save for their retirement.
Penalty for default
Under APY, the individual subscribers shall have an option to make the contribution on a monthly basis. Banks will be collecting additional amount for delayed payments, such amount will vary from minimum Rs. 1 per month to Rs 10/- per month as shown below:
- Rs. 1 per month for contribution upto Rs. 100 per month.
- Rs. 2 per month for contribution upto Rs. 101 to 500/- per month.
- Rs. 5 per month for contribution between Rs 501/- to 1000/- per month.
- Rs. 10 per month for contribution beyond Rs 1001/- per month.
Discontinuation of payments of contribution amount shall lead to following
- After 6 months account will be frozen.
- After 12 months account will be deactivated.
- After 24 months account will be closed.
Helpline Number – Toll Free Helpline number for APY Scheme is 1800-110-069
Benefits
Upon exit on attaining 60 years
The subscriber shall receive the following three benefits on attaining the age of 60:
(i) Guaranteed minimum pension amount: Each subscriber under APY shall receive a guaranteed minimum pension of Rs. 1000 per month or Rs. 2000 per month or Rs. 3000 per month or Rs. 4000 per month or Rs. 5000 per month, after the age of 60 years until death.
(ii) Guaranteed minimum pension amount to the spouse: After the subscriber’s demise, the spouse of the subscriber shall be entitled to receive the same pension amount as that of the subscriber,until the death of the spouse.
(iii) Return of the pension wealth to the nominee of the subscriber: After the demise of both the subscriber and the spouse, the nominee of the subscriber shall be entitled to receive the pension wealth, as accumulated till age 60 years of the subscriber.
Contributions to the Atal Pension Yojana (APY) is eligible for tax benefits similar to the National Pension System (NPS) under section 80CCD(1)
Voluntary exit (Exit before 60 Years of age):
The subscriber shall only be refunded the contributions made by him to APY along with the net actual accrued income earned on his contributions (after deducting the account maintenance charges).
However, in case of subscribers who joined the scheme before 31st March 2016 and received Government Co-Contribution shall not receive the Government co-contribution and the accrued income earned on the same, if opted for Voluntary exit before 60 years.
For death before 60 years
Option 1: In case of death of the subscriber before 60 years, option will be available to the spouse of the subscriber to continue contribution in the APY account of the subscriber, which can be maintained in the spouse’s name, for the remaining vesting period, till the original subscriber would have attained the age of 60 years. The spouse of the subscriber shall be entitled to receive the same pension amount as the subscriber until death of the spouse. Such APY account and pension amount would be in addition to even if the spouse has his/her APY account and pension amount in own name.
Option 2: The entire accumulated corpus till date under APY will be returned to the spouse / nominee.
Age of joining and contribution period
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.
All bank account holders under the eligible category may join APY with auto debit facility to accounts.