Atal Pension Yojana : Objectives, eligibility, funding

Atal Pension Yojana is a scheme launched on 9th May 2015 by Prime Minister Narendra Modi to make the senior citizens self-reliant after their retirement. The scheme aims to increase the old age income security of the working poor. The Government launched the scheme which came into effect from 1st June 2015. It replaced the Swavalamban Yojana/NPS Lite scheme.

The APY scheme is being administered by the Pension Fund Regulatory and Development Authority. It aims to provide a universal social security system for all citizens, especially the poor, the underprivileged and the workers in the unorganized sector.

The Atal Pension plan scheme is open to all citizens of India between 18-40 years of age having a savings bank account in a bank or post-office.

Need for Scheme
Earlier pension schemes of social security were unable to address the peculiar demographic settings of the country. Swavalamban Scheme was not able to cover many people due to ambiguities in benefits. Swavalamban also failed to guarantee a minimum pension provision.

Moreover, the unorganized sector which forms a large chunk of our labor force was not covered in true sense. This all led to the formation of an integrated scheme for this section i.e. Atal Pension Yojana.

Atal Pension Yojana Information can be accessed from below-

APY Desk – Call Centre: 1800 110 069


https://www.theindianwire.com/politics/atal-pension-yojana-214496/

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India Proposed Separating National Pension Scheme Trust From Pension Regulator PFRDA

The government has proposed to separate the National Pension Scheme Trust from pension regulator Pension Fund Regulatory and Development Authority in order to address issues over conflict of interest. The PFRDA implements and regulates the NPS and Atal Pension Yojana through various intermediaries including, the NPS Trust. The matter of conflict of interest arises as PFRDA is the regulator of the pension sector in India, at the same time it runs pension schemes such as NPS and APY.

“Keeping in view the wider interest of the subscribers and to maintain arm's length relationship of the NPS Trust with PFRDA, steps will be taken to separate the NPS Trust from PFRDA with appropriate organisational structure,” Finance Minister Nirmala Sitharaman said in the Union Budget 2019-20 presented in Parliament on Friday. The trust was established by the PFRDA for taking care of the assets and funds under the NPS. The proposal to separate the two job roles was under consideration for last few years.

APY, mainly targeting the unorganised sector employees, offers five slabs of pension from Rs 1,000-5,000 per month upon retirement. Employees in the age bracket of 18-40 years can sign up for an APY account. The NPS is a voluntary, defined contribution retirement savings scheme for government employees as well as for those working in the private sector.



https://www.bloombergquint.com/economy-finance/govt-proposes-to-separate-nps-trust-from-pfrda

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Everything you want to know about Atal Pension Yojana in indian

Atal Pension Yojana was introduced to benefit those people in the unorganised sector. The scheme provides financial security for old age and helps people deal with illness, accidents and diseases. The scheme also benefits private sector employees who are not given pension benefits by their company. Under this scheme, the investors get a fixed pension of Rs 1000, Rs 2000, Rs 3000, Rs 4000, or Rs 5000 on attaining an age of 60. The amount depends on the individual’s age and the contribution amount. Interestingly, Atal Pension Yojana had replaced the Swavalamban Yojana, which wasn't very popular among people.

According to the guidelines by the Government of India, the money invested through Atal Pension Yojana scheme is managed by the Pension Funds Regulatory Authority of India (PFRDA). The government would also make a co-contribution of 50% of the total contribution, or Rs 1000 per annum, whichever is lower, to all eligible subscribers who had joined between June 2015 and December 2015 for a period of 5 years i.e., for financial years 2015-16 to 2019-20.

Atal Pension Yojana eligibility:
To get the benefits of Atal Pension Yojana, an individual must:

- Be a citizen of India.

- Be between the age of 18-40.

- Make contributions for a minimum of 20 years.

- Must have a bank account linked with Aadhar.

- Must have a valid mobile number

Atal Pension Yojana: How to apply?

1. Visit any bank and start an account.

2. Download the Atal Pension Yojana form online. The forms are available in English, Hindi, Bangla, Gujarati, Kannada, Marathi, Odia, Tamil, and Telugu.

3. Fill the Atal Pension Yojana form and submit it to your bank along with mobile number and a photocopy of your Aadhaar card.

4. You will be sent a confirmation message when the application is approved.

Atal Pension Yojana monthly contributions:

The investors have the option to make contributions for monthly/quarterly/semi-annual intervals. All the contributions are made through auto-debit facility from the savings account of the subscriber. This amount depends upon the amount of pension a subscriber wants to receive upon retirement.

Atal Pension Yojana income tax benefits:

An individual can claim tax benefits up to Rs 1.5 lakh under section 80C as part of Atal Pension Yojana. Additionally, an income tax deduction of up to Rs 50,000 can be availed under the section 80CCD (1B) of the Income Tax Act of 1961.

Atal Pension Yojana important facts:

- The subscribers can increase the premium at their will.

- In case you default on your payments, a penalty of Re 1 per month for a contribution of every Rs 100 or part thereof is levied.

- If the default continues for six months, the account is frozen.

- What is critical to know is hat early Atal Pension Yojana withdrawal is not entertained. The entire amount is only given in case of death or terminal illness.



https://www.zeebiz.com/personal-finance/news-atal-pension-yojana-eligibility-monthly-contributions-how-to-apply-tax-benefits-important-facts-apy-scheme-benefits-pfrda

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PFRDA relaxes NPS exit rules on medical expenses

The Pension Fund Regulatory and Development Authority (PFRDA) has relaxed the exit rules under National Pension System (NPS) on medical grounds for the government employees, subscribers under All Citizen model, corporate model, NPS-Lite and Swavalamban subscribers.

The exit under the NPS is governed by the rules as per the Pension Fund Regulatory and Development Authority (Exits and Withdrawals under the National Pension System) Regulations, 2015, which is amended from time to time.

PFRDA has issued a gazette notification relaxing exit guidelines on medical ground, called the Pension Fund Regulatory and Development Authority (Exits and Withdrawals under the National Pension System) (Third Amendment) Regulations, 2018.

Government sector subscribers
The exit from NPS for government sector subscribers will be allowed if the employer certifies that the subscriber has been discharged from the services of the concerned office on ..account of invalidation or disability.

Citizens, including corporate sector subscribers

The exit from NPS by citizens, including corporate sector subscribers will be allowed if the subscriber is physically incapacitated or has suffered a bodily disability leading to his incapability to continue with his individual pension account under National Pension System.

In such cases, the exit is allowed subject to the subscriber submitting a disability certificate from a Government surgeon or Doctor (treating such disability or invalidation of subscriber) stating the nature and extent of disability and also certifying that:

a) The subscriber shall not be in a position to perform his regular duties and there is a real possibility of the affected subscriber, being not able to work for the remaining period of his life.; and

b) Percentage of disability is more than seventy five percent in the opinion of such Government surgeon or doctor (treating such disability or invalidation of subscriber)

NPS-Lite and Swavalamban subscribers

The exit from National Pension System by NPS-Lite and Swavalamban subscribers is allowed provided that a subscriber who is physically incapacitated or has suffered a bodily disability leading to his incapability to continue with his individual pension account under National Pension System.

The exit in such cases shall be subject to the subscriber submitting a disability certificate from a Government surgeon or doctor (treating such disability or invalidation of subscriber) stating the nature and extent of disability and also certifying that:

a) The subscriber shall not be in a position to perform his regular duties and there is a real possibility of the affected subscriber, being not able to work for the remaining period of his life.; and

b) Percentage of disability is more than seventy-five percent in the opinion of such Government surgeon or doctor (treating such disability or invalidation of subscriber).

Partial withdrawals

Further, a subscriber is already permitted to withdraw not more than 25 percent of one's own contribution after being a subscriber for at least ten years in NPS for specific needs such as higher education, home purchase, marriage or critical illness needs. The new rule allows such partial withdrawals to meet medical and incidental expenses arising out of the disability or incapacitation suffered by the subscriber. In case of disability, one can partially withdraw even without exiting.

//economictimes.indiatimes.com/articleshow/62792368.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

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Swavalamban subscribers of micro-pension scheme can switch to APY: PFRDA

MUMBAI: Subscribers of micro-pension scheme 'Swavalamban', which closes tomorrow, can switch to the 'Atal pension Yojana' (APY) and retain the government's co-contribution, a PFRDA official said today.

'Swavalamban' scheme, which was launched by the UPA government in 2010-11, is a government-backed micro-pension scheme aimed at the unorganised sector and applicable to those who joined the National Pension Scheme (NPS).

Under the scheme, the government contributes Rs 1,000 per year to each NPS account for the first four years.

"However, this co-contribution of Rs 1,000 per annum by the government will not be there for the subscribers of both micro-pension schemes 'Swavalamban' and NPS Lite, which have together got 44 lakh subscribers under their fold and total assets under management of Rs 2,083 crore at present, from April 1 onwards," a senior official of the Pension Fund Regulatory and Development Authority (PFRDA) told PTI.

"This 'Swavalamban' scheme has been replaced with APY which was launched in June last year and hence we are not accepting any fresh subscription under 'Swavalamban' scheme since then.

"PFRDA is offering to continue the government's co-contribution of Rs 1,000 per annum for next three years to all those 'Swavalamban' subscribers who opt to shift to APY from April 1," the official added.

Unlike 'Swavalamban', which was open to all those working in the unorganised sector, APY is applicable only to workers in the age group of 18-40 years.

APY has around 22 lakh subscribers and assets under management of Rs 492 crore.

Pension fund managers believe that the replacement of 'Swavalamban' scheme with APY will help them do more business.

"We at SBI Pension Funds do hope to see a similar or even better business growth due to PFRDA's decision to replace 'Swavalamban' scheme with APY in future," SBI Pension Funds' Chief Executive Shailendra Kumar said.

http://economictimes.indiatimes.com/articleshow/51619196.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

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NPS shoot up 50% to Rs.1,07,802 crore as on December-end 2015

Thanks to the introduction of the Atal Pension Yojana, the National Pension System has seen a 43 per cent year-on-year jump in the number of subscribers to 1.13 crore as of December-end 2015, from about 79 lakh as of December-end 2014.

Increasing awareness among individuals about the need for financial security and stability during old age via pension has also seen the assets under management (AUM) of NPS shoot up 50 per cent to ₹1,07,802 crore as on December-end 2015 from about ₹72,000 crore as on December-end 2014.

The Atal Pension Yojana (APY) was launched on May 9, 2015 as a retirement savings product for the unorganised sector under the aegis of the National Pension System (NPS). Up to December-end 2015, about 18 lakh subscribers joined APY and their contributions amounted to ₹262 crore, according to Finance Ministry data. Under the APY, subscribers will receive a guaranteed minimum pension, ranging from ₹1,000 to ₹5,000 a month, at the age of 60, depending on their contributions, which itself would be based on the age of joining the scheme.

Minimum age

The minimum age for joining the APY is 18 years and maximum age is 40 years. Therefore, minimum period of contribution by any subscriber under APY would be 20 years or more.

The NPS has five schemes — three meant for employees of the Central government, State government, and private sector; NPS-Lite (meant for the poor and unorganised class of citizens); and APY.

As of December-end 2015, the AUM under the Central government (NPS has been made mandatory for all new recruits to the government — except armed forces — with effect from January 1, 2004) and State government categories accounted for about 90 per cent of the overall corpus of ₹1,07,802 crore. The AUM under the private sector and NPS-Lite categories stood at ₹8,887 crore and ₹1,988 crore, respectively. The NPS is a voluntary, defined contribution retirement savings scheme designed to enable the subscribers to make optimum decisions regarding their future through systematic savings during their working life.

Under the NPS, individual savings are pooled into a pension fund. These funds are invested by the Pension Fund Regulatory and Development Authority (PFRDA) regulated professional fund managers as per the approved investment guidelines into a diversified portfolio comprising government bonds, bills, corporate debentures and shares. These contributions would grow and accumulate over the years, depending on the returns earned on the investment made.

At the time of normal exit from NPS, the subscribers can use the accumulated pension wealth under the scheme to purchase a life annuity from a PFRDA empanelled life insurance company, apart from withdrawing a part of the accumulated pension wealth as lump-sum.

http://www.thehindubusinessline.com/money-and-banking/aum-under-national-pension-system-rises-50-to-over-1-lakh-cr-in-dec-15/article8586294.ece

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Atal Pension Yojana: Regulator Eyes 70 Lakh New Subscribers in India

NEW DELHI: Pension regulator PFRDA is hopeful of enrolling at least 60-70 lakh new subscribers this fiscal to its Atal Pension Yojana (APY), a micro pension product primarily targeted at the unorganised sector. Since the launch of APY in July last year,  the number of subscribers for this product has touched 20 lakhs.

After more than three-hour long discussion with officers of public sector banks, post offices and micro finance, Hemant Contractor, Chairman of PFRDA said, “We are confident of doing much better this year as nearly 1,47,000 offices would distribute APY this year.”

The major concern the that was being raised by banks, post offices and micro finance institutions were the product requires lot of awareness among people and stressed the need for training of officers as well.   

Contractor’s optimism also came from the likely push that postal department for this product this fiscal. “About 20,000 post offices that are already networked under an IT platform (CBS) will start distributing APY. This will be big boost for APY,” Contractor said.

India Post had started APY distribution only from December last year. As on date, only about 1,000 post offices are offering APY, he said. Contractor said that 2015-16 saw huge response from individual subscribers with a record 1.3 lakh new subscribers opting for this products. This was more than the aggregate level recorded for the previous four years.

“The additional tax break of Rs 50,000 has been a real kicker. It has boosted interest in NPS,” the regulator  added.

http://www.newindianexpress.com/business/news/Atal-Pension-Yojana-Regulator-Eyes-70-Lakh-New-Subscribers/2016/04/13/article3377821.ece

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Atal Pension Yojana eligible for tax benefits as National Pension System

Contributions to the Atal Pension Yojana (APY) will now be eligible for the same tax benefits as the National Pension System (NPS), according to a circular released by the Income Tax department on Tuesday. The tax benefits include the additional deduction of Rs 50,000 under section 80CCD(1) introduced in last year's budget.

The APY is open to Indians aged between 18 and 40 years and has a minimum tenure of 20 years. Nearly 20 lakh subscribers have joined the scheme since its launch in June 2015. The APY replaced the NPS Lite or Swavalamban scheme, which got about 45 lakh subscribers in the past six years.

The biggest draw of the APY is that the government will contribute 50% of the contribution made by the investor for a period of five years. But this benefit will only go to subscribers who put in less than Rs 1,000 a year and those who join the scheme before 31 March 2016. Those with taxable income are also not eligible.

Most subscribers to the APY are small-ticket investors. Its AUM of Rs 328 crore is spread across 19.77 lakh accounts, so the average balance per account is only Rs 1,640. In comparison, the NPS Lite, which benefited from the market rally since 2010, has about Rs 1,982 crore lying in 44.63 lakh accounts, an average of Rs 4,440 per account.

http://economictimes.indiatimes.com/wealth/invest/atal-pension-yojana-eligible-for-same-tax-benefits-as-national-pension-system/articleshow/51108260.cms

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