Saturday, June 20, 2015

Atal Pension Yojana - All Your Questions Answered


In the previous article, we covered the Atal Pension Yojana in great detail. As mentioned at the end of the article, there may still be a few unanswered questions in your mind about this subject. The purpose of this article is to help you get those questions answered.

If you have any further questions on this Atal Pension Yojana, feel free to sound off in the comments section and as always, I would be more than happy to answer the same.

1. Who can Subscribe to the Atal Pension Yojana 

Anyone who is a citizen of India can join this scheme. The following are the eligibility criteria:
Age of the subscriber should be between 18 and 40 years
He/She should have a savings bank account
He/She should have a mobile number (for notification purposes)

2. Is the additional contribution of Rs. 1000 from the Government of India available for everyone?

No. People who are covered under statutory social security schemes are not eligible to receive this contribution from the government. The list of schemes under which an individual, if enlisted, is not eligible for this additional grant of Rs. 1000 are:
The Employees Provident Fund
The Coal Mines Provident Fund
Assam Tea Plantation Provident Fund
Seamens Provident Fund
Jammu Kashmir Employees Provident Fund
Any other social security scheme

3. How are my contributions to the Atal Pension Yojana invested?

The corpus collected as part of this scheme will be invested as per the guidelines prescribed by the Finance Ministry. Don’t worry, your money is 100% safe as the Government of India provides a guarantee for your pension once you attain the age of 60.


4. Can I choose how my money is Invested? For ex: Can I opt for my money to be invested in the stock market for higher growth/returns?

No, you cannot. As the returns are guaranteed by the Government of India, the investment is also done according to the directions of the Ministry of Finance of India.

5. I don’t have an Aadhar Card. Can I still enrol in this scheme?

Yes you can. Though Aadhar is the primary KYC expectation, it is still not mandatory (since the Aadhar coverage is still not 100%). You can still open your account without the Aadhar card but you are expected to get the card soon and update your records ASAP. This is done to avoid pension payout disputes in the future.

6. I don’t have a bank account. Can I still enrol in this scheme?

No, you cannot. Having a bank account is a minimum expectation and hence you will be expected to open an account first before you can enrol in this scheme.


7. What will happen if required or sufficient amount is not maintained in the savings bank account for contribution on the due date? 

Non-maintenance of required balance in the savings bank account for contribution on the specified date will be considered as default.


Banks are required to collect additional amount for delayed payments, such amount will vary from minimum Re 1 per month to Rs 10/- per month as shown below:
i. Re. 1 per month for contribution upto Rs. 100 per month.
ii. ii. Re. 2 per month for contribution upto Rs. 101 to 500/- per month.
iii. iii. Re 5 per month for contribution between Rs 501/- to 1000/- per month.
iv. iv. Rs 10 per month for contribution beyond Rs 1001/- per month.

Discontinuation of payments of contribution amount shall lead to following:
i. After 6 months account will be frozen.
ii. After 12 months account will be deactivated.
iii. After 24 months account will be closed.
Subscriber should ensure that the Bank account to be funded enough for auto debit of contribution amount

8. Is it required to furnish nomination while joining the scheme? 

Yes. It is mandatory to provide nominee details in APY account. The spouse details are also mandatory wherever applicable. Their aadhaar details are also to be provided.

9. How many APY accounts I can open? 

A subscriber can open only one APY account and it is unique

10. Will there be any option to increase or decrease the monthly contribution for higher or lower pension amount? 

The subscribers can opt to decrease or increase pension amount during the course of accumulation phase, as per the available monthly pension amounts. However, the switching option shall be provided once in year during the month of April.

11. When does the scheme mature?

The scheme ends when you reach 60 years of age wherein the entire corpus is used to subscribe to an Annuity product which will provide you with the pension – as agreed.
In case of the death of the subscriber (even if this happens before attaining 60 years age) the pension will be payable to the survivor (usually the spouse) and in case both the subscriber and his/her spouse is not alive, the corpus will be returned to the nominee.

12. How will I know the status of my contributions?

The status of your contributions will be intimated to your registered mobile number via regular SMS alerts. You will also receive a Physical Statement – which is expected once every year.


13. Are there any limitations for governmental contributions?

If you are a part of any other social security scheme and a tax payer, then you are not entitled for government contribution. For instance, members of the Social Security Schemes under the following enactments would not be eligible to receive Government co-contribution:  
  1. (i) Employees’ Provident Fund and Miscellaneous Provision Act, 1952.
  2. (ii)  The Coal Mines Provident Fund and Miscellaneous Provision Act, 1948.
  3. (iii)  Assam Tea Plantation Provident Fund and Miscellaneous Provision, 1955.
  4. (iv)  Seamens’ Provident Fund Act, 1966.
  5. (v)  Jammu Kashmir Employees’ Provident Fund and Miscellaneous Provision Act, 1961.
    (vi) Any other statutory social security scheme. 

However, you can still signup for the plan, there is nothing stopping you. 

Hope this article was able to answer your queries about the Atal Pension Yojana. If you have any further queries, do post a comment and I will try my best to answer your queries.

6 comments:

  1. I heard that those who have taxable income are not eligible for Rs. 1000 grant, m i right?

    ReplyDelete
    Replies
    1. Question No. 2 answers your question. It is not based on taxable income. IT is based on whether you are part of any existing social security scheme

      Delete
  2. hi, can you please tell me can i apply for Atal Pension Plan without Aadhar Card? As of now i dont have aadhar card. Do answer me please.

    ReplyDelete
  3. While reading the information about who cannot subscribe the Atal Pension Yojana, I got this: "The applicant must not have subscribed to any other statutory social security schemes."
    Does that mean a person who is subscribed to other statutory social security scheme can't subscribe to Atal Pension Yojana?

    ReplyDelete

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