Pension regulator PFRDA is eyeing a subscriber base of 1.5 crore for the Atal Pension Yojana (APY) by March-end, a top official said.
This will be a substantial jump over the subscriber base of 97 lakh as of March-end last year, Supratim Bandyopadhyay, Member (Finance), PFRDA, told BusinessLine .
“We have already added 44 lakh new APY subscribers up to December this fiscal. We will certainly cross 50 lakh this fiscal. The aspiration of 1.5 crore subscriber base is doable by March,” he said.
He felt the aim for APY should be to cover 4 per cent of the target population (about 40 crore in the 18-40 age bracket), from the current level of 3.5 per cent.
Bandyopadhyay also said PFRDA was hopeful that the upcoming Budget would announce changes to the APY scheme so as to give a further boost to the programme.
Key suggestions
Of the three main suggestions given by PFRDA to the Finance Ministry on APY, one related to increasing the monthly pension limit to ₹10,000 from the current slab of up to ₹5,000.
At present, there are five slabs of pension from ₹1,000-5,000 per month. There has been a lot of feedback from the market for higher pension amounts as many feel that ₹5,000 at the age of 60, 20 to 30 years from now, will not be sufficient.
PFRDA has, on its part, done actuarial valuation, and the reports have been sent to the Finance Ministry to enable them take an appropriate decision for the upcoming Budget. The other suggestions made by PFRDA were raising the maximum age bar to enter the scheme to up to 50 years from 40 years now, and also giving a nod for auto-enrolment for APY.
At present, the age to enter APY is between 18 and 40, but an increase in the same by another 10 years – 18-50 years – will help expand the subscriber base, he added.
It may be recalled that APY became operational from June 1, 2015, and is available to all citizens in the age group of 18-40 years.
Under the scheme, a subscriber would receive a minimum guaranteed pension of ₹1,000 to ₹5000 per month, depending on his contribution, from the age of 60 years.
The same pension would be paid to the spouse of the subscriber and, on the demise of both, the accumulated pension wealth is returned to the nominee.
APY follows the same investment pattern as applicable to the NPS contribution of Central government employees. PFRDA added about 50 lakh new subscribers under the scheme in 2017-18.