Atal Pension Yojana Expands Net to Small Finance Banks

• The Central government announced that the payments banks such as Airtel payments bank and small finance banks such as Utkarsh and ESAF will also offer social security scheme, Atal Pension Yojana (APY), to their subscribers.
• Currently, the scheme is offered via all mainstream banks such as State Bank of India (SBI), Oriental Bank of Commerce and Bank of Baroda, among others.
• In a bid to widen the APY net, it was felt that the new payments banks and small finance banks will provide the much-needed impetus to the outreach of subscribers under APY, the finance ministry said in a statement.

About Atal Pension Yojana (APY)

• This scheme was launched in May 2015. This scheme is administered by the PFRDA, and implemented through all the banks nationwide.
• It is a pension scheme for unorganised sector workers such as personal maids, drivers, gardeners etc, was launched in June 2015 by the government.
• This social security scheme was introduced as a replacement to previous government's Swavalamban Yojana NPS Lite, which wasn't well accepted by people.
• APY aims to help these workers save money for their old age while they are working and guarantees returns post retirement.
• The scheme also promises a co-contribution by Central Government of 50% of the total prescribed contribution by a worker, up to Rs. 1000 per annum, but only to those who joined APY before 31.12.2015. Further, this co-contribution would be made only for 5 years, from FY 2015-16 to 2019-20 in the eligible cases subject to conditions mentioned below.
• APY is a periodic contribution based pension plan and promises a fixed pension of Rs 1000/ Rs 2000/ Rs 3000/ Rs 4000 or Rs 5000.

By: Vishal