An Introduction to Atal Pension Yojna

It is often thought that the ones working in the private and unorganized sectors often have very less financial planning. But this is really not the scenario as the Atal Pension Yojana was specially designed for the workers of the unorganized sector in the form of a pension scheme. It has been implemented for the personal drivers, gardeners, maids etc. this scheme for social security was a replacement of the Swavalamban Yojana of the previous government of 2015 which was not readily accepted by such people.

The major aim of the Atal Pension Yojana is to help out such workers and people by saving money while working for the period of old age and also guarantees return after retirement. The total contribution that a worker makes in the scheme is noted and the Central Government makes 50% of the contribution separately as a co-contribution. The amount is up to INR 1000 every year. The contributions are only made for the ones, who have joined the scheme before 31^st Dec 2015. It is also to be noted that the co-contribution will be provided for five years only according to the conditions that are mentioned in the scheme.

What is the eligibility for Atal Pension Yojana?

1. Should be a citizen of India
2. Should be between 18-40 years
3. Should be holding a bank account that is valid.

Payment Mode and Monthly Contribution

This pension plan is based on the periodic contribution which promises a person of receiving a fixed amount of pension of INR 1000/2000/3000/4000/5000. The contribution that is to be made per month depends on the monthly pension of a fixed amount that one wants to receive and the age from which the contributions are made. The person starts receiving the pension from his 60^th year. Hence, even if a person starts the scheme at the age of 40, he will have to pay the premium for at least 20 years for availing the pension.

Benefits of the Atal Pension Yojana

The subscribers are guaranteed a pension from INR 1000-5000. The subscriber also gets an opportunity to increase or decrease the amount of pension during the accumulation phase and this can be done once in a year.

If there is a sudden death of the subscriber, his/her spouse is entitled to the exact pension amount till his/her last breath. If both the subscriber and his/her spouse passes away, the pension amount will be received by the nominee that has been accumulated by the subscriber till 60 years of his age.

Again if the subscriber passes away before attaining the age of 60 years, his/her spouse can decide whether they will continue with the scheme or will exit the same. If they plan to exit, they can claim the amount that has been accumulated. And if they continue, the same contribution is to be made in the account of the subscriber for the years that are left over. In this case, the subscriber’s spouse will be entitled to draw the same pension as promised to the subscriber till he/she dies.

What are the restrictions on the part of the contribution made by central government?

If a person has taken part in any other scheme for social security or pays tax in any other form, then the person does not receive the contribution from central government. Even the ones who are members of the following schemes of social security will also not receive the co-contribution from the Government. They are:

• The Coal Mines Provident Fund and Miscellaneous Provision Act, 1948
• Employees’ Provident Fund & Miscellaneous Provision Act, 1952
• Seamen’s Provident Fund Act, 1966
• Assam Tea Plantation Provident Fund and Miscellaneous Provision, 1955
• Jammu Kashmir Employee’s Provident Fund & Miscellaneous Provision Act, 1961
• Other statutory schemes of social security.

Process of Application

Get to the nearest bank or post office. It should be having the savings account of the particular individual. Even if one does not have one, he can surely open a savings account and then fill up the registration form of the Atal Pension Yojana.

The people who are quite accustomed to the internet can enroll themselves for the scheme through their savings account with the help of internet banking directly. For making their contributions, they can also select the facility of auto debit. The premiums for the scheme will start getting debited from the time the person enrolls for the scheme till he attains 60 years of age. Except for SBI and ICICI, the other banks do not provide the enrollment through the internet.

After a person has completed 60 years of age, he will have to visit the bank or PO. Here, they will have to request for being able to draw the pension. If the subscriber dies, the same amount of pension gets passed on to the spouse and if the spouse passes away too, it is passed over to the nominee.

Conclusion

There are certain things that are to be noted. If payments are not made for six consecutive months, the account of the subscriber will be frozen. And if they are not made for twenty four consecutive months, the account of the subscriber will get closed permanently. It especially caters to the labor class, unemployed and backward classes of the society.