Atal Pension Yojana – APY Scheme Eligibility & Benefits Explained

Atal Pension Yojana – APY Scheme Eligibility & Benefits Explained in this article. This scheme is launched on 9th May 2015.

This scheme launched along with Pradhan Mantri Jeevan Jyothi Bhima Yojana (PMJJBY) and Pradhan Mantri Bhima Surakha Bhima Yojana (PMSBY).

Latest Updates ( as on 20th August 2015)-Government modified some rules of APY. They are as given below

  • Now instead of only monthly payment option, the subscribers can invest like monthly, quarterly, half-yearly or yearly modes.
  • The account will not be deactivated and closed till the account balance with self-contributions minus the government co-contributions become zero due to deduction of account maintenance charges and fees.
  • The penalty on delayed payment has been also has been simplified to Rs.1 per month for a contribution of Rs 100 for each delayed monthly payment instead of different slabs given earlier.
  • Premature withdrawal now is possible with some conditions.
  •  The subscriber will get the refund of the contributions made by him to APY, along with the net actual interest earned on his contributions.

  • Some more changes via notification dated 29th April, 2016 is as below.

Option to the spouse of the subscriber to continue contribution to APY in case of death of subscriber before the age of 60 years:

“If the subscriber dies before 60 years of age, then his/her spouse would be given an option to continue contributing to APY account of the subscriber.

which can be maintained in the spouse’s name, for the renaming vesting period(years), till the original subscriber would have attained the age of 60 years.

The spouse of the subscriber shall be entitled to receive the same pension amount as that of the subscriber until the death of the spouse.

Atal Pension Yojana – APY Scheme Eligibility & Benefits Explained
Atal Pension Yojana – APY Scheme Eligibility & Benefits Explained

Retirement planning is one of the most important Financial goal of Financial Planning for everyone.

However, truth is only a few individuals plan for it.

The reasons are so many. 

Two main reasons for this are-Negligence and as unique and best pension plan not available.

few years back, the Government has launched the New Pension Scheme (NPS).

However, it failed to gain popularity.

Again, Government launched one more pension plan.

How much pension you will get?

The deviation word, that will attract you about this scheme is a GUARANTEED PENSION.

This scheme offers you the minimum guaranteed pension of Rs. 1,000, Rs. 2,000, Rs. 3,000, Rs.4, 000 or Rs.5, 000 per month.

This pension will start once you attain the age of 60 years.

However, this pension amount depends on the contributions made by the subscribers.

Who are eligible to invest in this scheme?

The eligibility conditions are given below…

  • Your age must be within 18-40 years of age.
  • You should have a Savings Bank Account.
  • The subscriber(you) must have a mobile phone.
  • This number you should provide during registration

How much Government will contribute towards this scheme?

The Government also will contribute 50% of the total contribution or Rs.1, 000 per year, whichever is lower, for 5 years.

i.e. from 2015-16 to 2019-20.

But, to get this Government contribution, you must enroll for this scheme from 1st June 2015 to 31st December 2015.

In addition, please remember that this Government contribution for this scheme will not be available for INCOME TAXPAYERS or individuals who are already members of schemes like…

  • The Coal Mines Provident Fund and Miscellaneous Provision Act, 1948
  • Assam Tea PlantationProvident Fund and Miscellaneous Provision, 1955
  • Jammu Kashmir Employees’ Provident Fund & Miscellaneous Provision Act, 1961
  • Seamens’ Provident Fund Act, 1966
  • Employees Provident Fund and Miscellaneous Provision Act, 1948.
  • Any other statutory social security schemes.

Who administers this scheme?

PFRDA/GOVERNMENTS will administrate this scheme.

How to invest in this APY scheme?
  • Approach your bank branch where you have a savings bank accouYou
  • YOu have to Fill the APY Registration Form.
  • Provide Aadhaar and Mobile Number
  • Make sure you have sufficient balance in saving account for monthly transfer.
  • As your monthly investment in this scheme will be done through an auto-debit facility.

What will be the auto-debit date for the subscription installment?

Your first investment date will be considered as the monthly auto-debit date of investment

Whether Aadhar is mandatory for APY?

It is not mandatory, but Aadhar is a Primary document for KYC.

Nomination mandatory For APY?

yes, It is mandatory to nominate for this scheme.

How many APY accounts, one can subscribe?

Only one APY account you can have.

Whether one can increase or decrease the contribution in APY?

yes, you can increase or decrease your contribution as per your need.

What will happen in case you miss a monthly contribution for APY?

In case you failed to maintain the sufficient balance on the auto-debit date, then the account will be treated as default.

Banks may collect the penalty for this. The penalty varies from bank to bank.

Such penalty varies from Rs. 1 to Rs.10 per month.

The government sets a limit for this penalty as given below.
  • Rs.1 per month penalty in case of your monthly contribution is up to Rs.100.
  • Rs.2 per month penalty in case of your monthly contribution is up to Rs.101 to Rs.500.
  • Rs.5 per month penalty in case of your monthly contribution is up to Rs.501 to Rs.1, 000.
  • Rs.10 per month penalty in case your monthly contribution is beyond Rs.1, 001

In case you discontinue the contribution for APY, then the following actions will be taken

  • After 6 months, the APY account will be frozen.
  • 12 months Later, the APY account will be deactivated.
  • After 24 months, the APY account will be closed.

How to withdraw from APY Scheme?

a) When you attain age of 60, then you have to fill the exit form in order to get the pension with 100% annuitisation of the wealth accumulated.

b ) In case of death of the subscriber, the pension will continue to the spouse.

On the death of both subscriber and spouse, then the pension corpus would be returned to the nominee.

c) Exit before 60 years of age is permitted the only in case of the death of a subscriber or terminal disease.

Settlement in a case of death of the subscriber before attaining the age of 60 years

If subscriber died before attaining the 60 years of age, then the below rules will apply.

If death occurs before attaining 60 years of age, then his or her spouse will be allowed to continue the account in their name.

The account will attain the eligibility for a pension once the age of original(first) subscriber age reaches 60 years of age.

After that period, the spouse of the deceased subscriber will be eligible to receive the pension as usual.

However, if spouse not interested to continue the account, then the account will be closed and the accumulated corpus will be given to the spouse(wife/husbad).

If spouse not alive, then the corpus will be payable to the nominee.

Whether you get a statement of investment?

Not only regular SMS to your registered mobile number but also you will receive the account statement.

In the below-given chart, I have explained how much an individual to contribute to receive the various minimum pension.

Atal Pension Yojana monthly contribution for indicative pension.


Age of JoiningYears of ContributionIndicative monthly penison
Indicative monthly pension of
Indicative monthly pension of
Indicative monthly pension of
Indicative monthly
of Rs.5,000

Whether it is worth to subscribe to APY?

We have already NPS and Swavalamban.

Then why one more pension plan from Government.

It is just a political stunt to attract people that they are launching new scheme.

Let us analyze the above table to understand whether this scheme is worth or not.

If your age is 19 years, then you need to contribute Rs.228 to get the guaranteed pension of Rs.5,000 till 100 years.

No body knows what will be the interest rates after 41 years.

Let us understand whether this scheme is worth or not with two scenarios.

Scenario 1) with APY…

Let us assume that the risk free rate of return after 41 years is 4%.

So, the corpus that will be accumulated in this scheme all these years to get a guaranteed pension of Rs.5,000 for 480 months from age 60 to 100 is Rs.12,13,142.

See the below table to understand it much better.

Number of Months this
Rs.5,000 will be paid
Pension Per Month 5000
Return Assumed
per year
Monthly return0.00327374
So the corpus
required to give
Monthly Rs.5,000


To get Rs.12,13,142.86 after 41 years by investing Rs.228 monthly for 492 months, your investment should generate 9.09%.

The corpus required at age 60
to get monthly Rs.5,000
fixed pension is ₹ 12,13,142.86
Number of months492
Monthly Investment made all these
492 months(i.e 41 years per month).-228
The monthly rate of return is 0.76%
The year return will be0.090925534
The effective return will be9.09%

Hence, if the rate of return expected from retirement corpus is 4% then the return generated from the investment all these years before retirement turned out to be 9.09.

Scenario 2) without APY…

If a 19 years old person investing on his own in various asset classes like mutual funds etc and gained 2.5% rate of return more than the scenario 1).

The rate of return
expected is
Numberr of months
investment done
The future value of the
corpus at age 60
₹ 21,65,073.23

It is not difficult to generate 2.5% extra return than the APY scheme(9.09%).

If we do so, our corpus at age 60 will be Rs.21,65,073.23.

Now, let’s see for the same risk free return of 4% per annum at age 60 what will be the monthly pension we will get?

Corpus availabe ₹ 21,65,073.23
Number of months this pension required480
Return expected from the corpus4%
Monthly Pension will come₹ 8,923.41

We can clearly see Scenario 2) looks much better than the scenario 2).

If you notice above table, by investing on your own without APY and a return of 11.5% on your investment then you are ending up with more corpus at retirement and at the same time more pension at the retirement.

Not only we will get more corpus But also we have the flexibility if we invest in our own method based on risk tolerance and financial situation.

In addition, APY does not provide you any kind of liquidity till retirement.

A 19 year old person can take high risk by investing in Equity Mutual funds to generate extra 2% return easily which I have shown in scenario 2).

The Government will contribute an equal amount (or maximum Rs.1, 000 per year) for only five years.

However, see the conditions of eligible candidates to avail this Government contribution.

First, you should not be a taxpayer and second not a member of an EPF kind of schemes.

Hence, a large number of individuals automatically not eligible for this benefit. Along with that, they contribute only up to 5 years. Hence, I think this is just a political gimmick than a promotion of a true pension scheme

How to download your ePRAN or transaction statement of Atal Pension Yojana or APY?

The facility to download and/or print ePRAN Card and Transaction Statement is made available in nps website.

You have access to your ePRAN Card and Transaction Statement through CRA NPS Lite website (

You have an option to search your e-PRAN Card and Transaction Statement with/without PRAN details.

It will then ask to provide minimum details like PRAN and Bank Account Number or Subscriber Name, Bank Account Number and Date of birth registered in the CRA system under ATAL PENSION YOJANA.

How to track APY Grievances?

An SMS/E-mail alert (along with the Token No.) is sent to ATAL PENSION YOJANA Subscriber on generation and resolution of a grievance in CRA system.

Read article about What is Nps and how to subscribe to it?. Click here to subscriber.

Share With Friends and Family

Leave A Comment

Your email address will not be published. Required fields are marked *