The eligibility criteria and benefits of Atal Pension Yojana explained!

Posted by HussainTambawala on February 19th, 2021

Whether salaried or self-employed, we have no means of creating a corpus for retirement. We do have access to pensions and provident funds which help us live our golden years without any financial challenges. However, when it comes to members of the unorganised sectors such as drivers, domestic help, gardeners, labourers, etc., they do not receive any retirement corpus which they can access when they retire. But with the Indian Government’s scheme Atal Pension Yojana launched in 2015, members of the unorganised sector can plan their retirement.

Eligibility criteria

Those who are eligible for the APY scheme should fulfil the following criteria:

• Must be an Indian citizen
• Should be aged between 18 to 40 years while opening the account
• Need to have a valid bank account, preferably in a nationalised bank
• You must have a national ID proof such as Aadhaar or PAN card
• The Aadhaar details should be linked to your bank account
• You must have a valid mobile number connected to your Aadhaar and bank account
• You should make monthly contributions to your APY account for at least 20 years for availing the benefits offered

Benefits

The APY is a low-risk retirement scheme which comes with a guarantee from the Indian Government. The benefits are as follows –

• Based on the contributions made, the pension account holder receives a guaranteed pension of INR 1,000, INR 2,000, INR 3,000, INR 4,000, or INR 5,000 monthly when you retire by 60 years or until your death.
  
  
• The Atal Pension Yojana scheme guarantees benefits to the spouse or the nominee as listed by you according to the rules of the scheme in case of your demise.
  
  
• You can open this account visiting the nationalised bank or Indian post office by simply filling the form. It is also possible to download the form from the official PFRDA website (http://www.pfrda.org.in/)
  
  
• Although APY was launched keeping the members of the unorganised sector in mind, the scheme now accepts contributions from those who also hold other Government-backed pension scheme or private schemes. The account gets opened by members who fall under the unorganised as well as organised sectors.
  
  
• APY scheme has a flexible subscription scheme, and you can increase or reduce the contributions anytime.
  
  
• Contributions made in the account qualify for tax exemption and benefits under Section 80CCD (1) of the Income Tax Act, 1961.

Requirements for contribution

You need to follow the basic terms and conditions concerned with monthly contributions under the pension scheme. Essentially, you should choose a plan and decide the pension amount you can contribute. The minimum monthly contribution allowed under APY is INR 1,000, while the maximum contribution made is up to INR 5,000.