Atal Pension Yojana
As our young population ages, it is also going to be pension-less.
Encouraged by the success of the Pradhan Mantri Jan Dhan Yojana, I
propose to work towards creating a universal social security system for
all Indians that will ensure that no Indian citizen will have to worry
about illness, accidents or penury in old age”, said Finance Minister
Jaitley in his February 2015 Budget speech. In keeping with this ideal, a
National Pension Scheme, the Atal Pension Yojana will be effective from
1 June 2015. The scheme intends to bring pension benefits to allow
people of the unorganised sector to enjoy social security with minimum
contribution per month.
People who work in the private sector or employed in occupations that
do not give them the benefit of pension can apply for the scheme. They
can opt for a fixed pension of INR 1,000 or 2,000 or 3,000 or 4,000 or
5,000 on attaining the age of 60. The amount of contribution and the
individual’s age will determine the pension. Upon the contributor’s
death, the spouse of the contributor can claim the pension and after the
spouse’s death the nominee will be returned the corpus accrued.
The amount collected under the scheme is to be managed by Pension
Funds as per the investment pattern specified by the Government.
Individual applicants will have no choice of pension funds or investment
allocation.
Benefits of Atal Pension Yojana
The Atal Pension Scheme will bring security to ageing Indians while
at the same time promote a culture of savings and investment among the
lower and lower middle class sections of society. One of the greatest
benefits of the scheme may be enjoyed by the poorer sections of society.
The government of India has decided to contribute 50 percent of the
user’s contribution or INR 1,000 a year (whichever is lower) for a
period of five years. This contribution will, however, be enjoyed only
by those who are not income tax payers and those who join the scheme
before 31 December 2015.
Who is Eligible?
The Atal Pension Yojana (APY) is open to all Indians between the age
of 18 and 40. This allows an individual to contribute for at least 20
years before reaping the benefits of the scheme. Any bank account holder
who is not a member of any statutory social security scheme can avail
of the scheme.
All existing members of the government’s ‘Swavalamban Yojana NPS
Lite’ will automatically be migrated to the Atal Pension Yojana. It will
now replace the Swavalamban scheme, which did not gain much popularity
across the country.
How to Enroll?
To sign up for the Atal Pension Yojana, an account holder must fill
in an authorisation form and submit it to his/her bank. The form will
require complete details including account number, spouse and nominee
details, and authorisation for auto debit of contribution amount.
Account holders signing up for the scheme need to ensure that sufficient
balance is maintained in the account every month, failing to do so will
attract a monthly fine of –
- INR 1 for monthly contribution up to INR 100
- INR 2 for monthly contribution between INR 101 and INR 500
- INR 5 for monthly contribution between INR 501 and INR 1,000
- INR 10 for monthly contribution beyond INR 1,001
If no payment is made towards the scheme
- for six months, the holder’s account will be frozen
- for 12 months, the holder’s account will be deactivated
- for 24 months, the holder’s account will be closed
The application form can be downloaded from http://www.jansuraksha.gov.in/FORMS-APY.aspx. The forms are available in different languages – English, Hindi, Gujarati, Bangla, Kannada, Odia, Marathi, Telugu and Tamil.
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