Atal Bihari Vajpayee Pension Scheme – APY Scheme -

Atal Bihari Vajpayee Pension Scheme – APY Scheme

The government-backed Atal Bihari Vajpayee pension scheme (APY) is open to all citizens of India particularly the unorganized sector is the main focus of this scheme. Atal Bihari Pension Yojana is under the administration of PFRDA (Pension Funds Regulatory and Development Authority) under the National Pension System (NPS).

Under this scheme, subscribers are guaranteed a minimum monthly pension of between Rs 1,000 and Rs 5,000. Subscribers can choose a monthly pension, which can be Rs. 1,000, 2,000, 3,000, 4,000 or 5,000, which starts after 60 years of age of the investor. 

The amount of the pension that a subscriber will receive is directly related to the age of the subscriber at which he/she joined the Atal Pension Yojana, and the monthly amount of the contribution. 

Atal Bihari Vajpayee Pension Scheme


Eligibility Criteria For Atal Bihari Vajpayee Pension scheme 

  • All citizens of India having age between 18 to 60 years can subscribe to Atal Pension Yojana
  • Under the APY the investor have to contribute for at least 20 years to get the benefits
  • The citizens who have subscribed to Swavalamba Yojana will automatically migrate to Atal Pension Yojana.
  • Individuals who want to invest in APY should have a savings account in the post office or a bank
  • The subscriber of APY should have an active mobile number

Atal Bihari Vajpayee Pension scheme Key Features 

Automatic Debit

One of the main facilities of Atal Pension Yojana is automatic debit. As a beneficiary of AYP, you can link your post office/bank account with your APY account and your monthly contribution towards APY will be directly deducted. 

So the subscribers who have signed up for this plan must therefore make sure that they have sufficient funds in their account to be able to receive the automatic debit, otherwise, they will be fined.

Contributions Increasing Facility 

As mentioned above, an individual is eligible to receive a pension under the AYP scheme after the age of 60 years, and the amount of the pension he/she will receive depends on the contribution towards the AYP scheme. Different contribution amount towards the AYP scheme determines the different monthly pension amount. 

An individual may choose to invest a higher amount in his AYP account so that he can get the higher pension amounts later under the plan. To alleviate this need, the government offers the opportunity to increase or even reduce a person’s contribution to changing the number of pensions once a year.

Guaranteed Pension 

Depending on the monthly contribution towards the AYP scheme by an individual he can choose to receive a monthly pension of Rs. 1000, 2000, 3000, 4000 or Rs 5000. 

Restriction of Age for APY Scheme

Any Indian citizen who is above 18 and below 40 years of age can invest in Atal Pension Yojana. 

So to generate income for old ages college students can also decide to invest in the APY plan. The maximum age bar for interested investors to scribe to this scheme is 40 years. And investors have to invest at least 20 years under the APY scheme.  

Also Read: State Bank of India Deposit Schemes

Atal Pension Yojana Withdrawal Policies

The investor of Atla Pension Yojana when reaches the age of 60, is entitled to an annuity from the entire amount of the corpus, that is, he/she can receive a monthly pension after he/she has concluded this scheme with their respective bank or post office. It should be remembered that an investor can leave the APY scheme before the age of 60 years only in case of a fatal illness or death.

In the event of the death of the main beneficiary before the age of 60 years his/her spouse is entitled to get the pension. In such a case, the spouse has the choice between retirement benefits or leaving the APY with the accumulated corpus. However, if he/she decides to leave Atal Pension Yojana before the age of 60, he/she will only receive cumulative premiums and accrued interest on them.


In the case the investor delays the contribution payments, the penalties charged in such a case are as under:

  • For monthly contributions of up to Rs. 100/ penalty amount is Rs. 1
  • Within Rs. 101 to 500 as a monthly contribution penalty amount is Rs. 2
  • Within Rs. 501 to 1000 as a monthly contribution penalty amount is Rs. 5
  • For a monthly contribution of Rs. 100 and above penalty amount is Rs. 10

If the investor fails to pay the contribution amount towards the APY continuously for six months then such an account shall be frozen. And if he fails to pay the contribution amount continuously for 12 months then his/her account shall be deactivated and the amount acclimated along with the interest will be returned to such an investor. 

Is Atal Pension Yojana Covered Under 80c?

Investments made by an investor in Atal Pension Yojana are exempted from Tax under Section 80CCD of the Income Tax Act of 1961. According to Section 80CCD (1), the maximum allowable exemption is 10% of the gross income of the person concerned, up to a limit of Rs. 1.50.000. 

An additional tax exemption of Rs. 50,000 are allowed under Section 80CCD (1B) for contribution to the Atal Pension Yojana. 

With all this, it is advised to consult a tax professional for these exemptions, as these tax benefits can be used under the special provisions specified in the Income Tax Act.

Atal Pension Yojana Benefits 

APY’s some of the main benefits are listed below:

Old-Age Income Source

After the age of 60 years, investors of APY are eligible to get a steady source of income. Thus they become able to meet their financial requirements like medications which are common in old age. 

Government-Backed Pension Plan

APY is backed by the government of India and is under the control of the Pension Fund Regulatory Authority of India (PFRDA). Therefore the investors of the APY scheme do not carry any risk of loss as their pension is assured by the government.  

Helping Unorganized Sector

Atal Pension Yojana was launched primarily to reduce the financial concerns of individuals working in unorganized industries and thus enable them to become financially independent in their old ages. 

Facility of Nominee 

In the event of the death of the APY subscriber, the spouse is entitled to the benefits of this plan. They may close their account and use the entire corpus at one time or choose to receive the same amount of pension as the original beneficiary. 

In the event of the death of both the beneficiary and the spouse, the nominee shall be entitled to the full amount of the corpus.

How to Open  Atal Pension Yojana Account

All Indian national banks offer Atal Pension Yojana. An individual can visit any branch of these banks to open an account under APY. The steps to open an APY account are as follows:

  • You can visit your nearest branch where you have an account.
  • Get the application form there and duly fill that to register under APY. You can also download the application form online from the official website of the bank or the PFRDA official website.
  • Fill up the application form properly
  • Along with active mobile number and photocopy of Aadhaar card submit the duly filled application form.
  • You will receive a confirmation message when your application is approved. 

What is Monthly Contribution for APY Scheme

If anyone wants to invest in Atal Pension Yojana he/she has to invest every month according to the table given below. The amount of monthly investment depends on the age of entry of the investor and the target pension per month that he/she wants after 60 years.  

Entry Age  Total  Contribution Years  Required Monthly Contribution Amount 
 Monthly     Pension of   Rs. 1000  Monthly   Pension of   Rs. 2000  Monthly   Pension of   Rs. 3000  Monthly   Pension of   Rs. 4000  Monthly   Pension of   Rs. 5000
18 42 42 84 126 168 210
19 41 46 92 138 183 228
20 40 50 100 150 198 248
21 39 54 108 162 215 269
22 38 59 117 177 234 292
23 37 64 127 192 254 318
24 36 70 139 208 277 346
25 35 76 151 226 301 376
26 34 82 164 246 327 409
27 33 90 178 268 356 446
28 32 97 194 292 388 485
29 31 106 212 318 423 529
30 30 116 231 347 462 577
31 29 126 252 379 504 630
32 28 138 276 414 551 689
33 27 151 302 453 602 752
34 26 165 330 495 659 824
35 25 181 362 543 722 902
36 24 198 396 594 792 990
37 23 218 436 654 870 1087
38 22 240 480 720 957 1196
39 21 264 528 792 1054 1318
40 20 291 582 873 1164 1454

The monthly table of Atal Pension Yojana is indicative and the actual amount of the premium is subject to change.                   


Atal Bihari Vajpayee pension scheme is a government-backed pension scheme for all eligible citizens of the country. This scheme was primarily for the people working in unorganized sector to provide them financial assistance and make them financially independent in old ages. Pension Funds Regulatory and Development Authority (PFRDA) controls and governs the APY Yojana.

Under this scheme, an investor has to contribute for 20 years and after the age of 60 years, he/she will get a monthly pension of Rs. 1000, Rs. 2000, Rs. 3000, Rs.4000, or Rs. 5000. Being a government scheme there is a guaranteed monthly pension for the investor. 

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