Pension regulator, PFRDA, on Wednesday, asked banks to “activate” all their branches in urban areas so as to promote Atal Pension Yojana (APY), a pension scheme designed for the informal sector. This was required given the vast number of urban poor in the country and the huge scope to push APY among the people in the 18-41 years age bracket.

e-APY

Banks have also been persuaded to go in for e-APY, which provides for digital onboarding to the scheme, Deepak Mohanty, Chairman, PFRDA said after an event organised by PFRDA in the capital to felicitate top performing APY service providers including banks.

Under APY, a subscriber would receive a lifelong minimum guaranteed pension of ₹1,000 to ₹5,000 per month from the age of 60 years, depending on their contributions, which itself would vary based on the age of joining the APY. 

As of June 1 this year, there are 5.4 crore subscribers to APY and total assets under management stood at about ₹28,800 crore. The average annual investment return from APY scheme corpus stood at 8.67 percent. 

Also read: NPS and APY enrolments cross 1.36 crore in 2022-23

Department of Financial Services Secretary Vivek Joshi spoke at the event and urged banks and service providers to better communicate the features and benefits of APY to the market and ensure that the potential subscribers are well informed about the scheme.

He urged banks and all service providers to continue their efforts till all the eligible Indian citizens are covered under APY and to contribute diligently towards making India a pensioned society.

For 2023-24, the Pension Fund Regulatory and Development Authority (PFRDA) has set a target of 1.34 crore enrolments for APY. This is higher than the enrolment of 1.2 crore achieved for 2022-23 as against target of 1.13 crore set for the last fiscal.

‘Realistic target’

Asked if the APY target for 2023-24 was less ambitious, Mohanty replied in the negative. “The target is realistic. We want to put a target that banks don’t get pressurised upon. Banks are already juggling with multiple targets of various government schemes. We have given a realistic target for APY”, Mohanty added.

Mohanty pointed out that APY was a contributory scheme and requires a nudge from banks. “APY is a good scheme. It should not only be seen as a pension scheme, but also as an investment scheme. Compared to the potential, the current enrolment level is less. There is long way to go”, Mohanty added.

To another question on raising the maximum pension limit under APY from ₹5,000 to ₹10,000 per month, Mohanty said there is no such proposal on that front as on date. However, PFRDA keeps giving suggestions to the government from time to time on such issues, he said.

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