What is Atal Pension Yojana?
The Atal Pension Yojana is an important social security scheme for people in the unorganised sector who are excluded from retirement savings schemes. But what is Atal Pension Yojana? It is a scheme that seeks to provide monthly pension to the contributors. These include domestic maids, drivers, gardeners, vegetable sellers, etc who do not have any other scheme that pays them in their retirement. By contributing to this scheme, the people are guaranteed a monthly pension after they reach 60 years of age.
Here is a brief guide to Atal Pension Yojana details:
The eligibility for the Atal Pension Yojana is simple. There is a limit on the age, but other conditions are very simple:
- The contributor must be between 18 to 40 years of age
- Must have a bank account
- Must be an Indian citizen
- Aadhar linked bank account is preferable for identity verification
- A valid mobile number is also highly recommended but not an eligibility criterion per se.
- Contribution amount:
The monthly contribution depends on the age of the contributor when he gets enrolled in the Atal Pension Yojana. It also depends on the final pension that the contributor will receive. For example, a person who is 28 years of age and wanting a monthly pension of Rs. 4,000 per month will have to contribute Rs. 388 per month for 20 years.
Similarly, a person who is 35 years wanting a pension of Rs. 2,000 per month will pay Rs. 363 per month. The monthly contributions keep increasing as the age of the contributor increases.
- Contribution period:
Each contributor has to contribute to the scheme until he or she is 60 years of age. Once the contributor crosses 60 years, the monthly pension will be credited to the bank account of the contributor.
- Application process:
The Atal Pension Yojana scheme details can be found with any of the nationalised banks in the country. They offer the scheme. To begin with, one needs to open The Atal Pension Yojana account. Fill and submit the form. A copy of the Aadhar card will be required for verification. Once the application process is done, a confirmation message will be sent to the subscriber. If you already have a bank account, you can talk to your bank, get the APY scheme details, and fill the form to get the monthly contributions started.
Once the subscriber reaches 60 years of age, he has to intimate his bank to submit a request for withdrawal of the pension. In case of death of the subscriber, the pension will be paid to the spouse/ nominee.
It is not allowed to withdraw money from the APY before the subscriber reaches 60 years of age. It is allowed only in exceptional circumstances such as terminal illness. If the contributor dies before reaching 60 years, the spouse can withdraw contributions or continue the account and receive the pension.
With this handy guide, you can open your Atal Pension Yojana account now!
Have short term investment goals? Read more!
Looking to apply for a Atal Pension Yojana Scheme? Contact your local HDFC Bank branch now!
* The information provided in this article is generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances.