Key features of unorganised sector workers' pension scheme

R Venkatesan Chennai | Updated on April 29, 2019 Published on April 29, 2019

The Centre introduced a pension scheme for unorganised sector workers called the Pradhan Mantri Shram Yogi Maandhan (PMSYM) in its February 2019 interim Budget.

The scheme covers home-based workers, street vendors, mid-day meal workers, head loaders, brick kiln workers, cobblers, rag pickers, domestic workers, washermen, rickshaw pullers, landless labourers, agricultural workers and construction workers, among others.

Here are its key features and investment guidelines:


Unorganised sector workers with a monthly income of less than Rs 15,000 per month, in the age group of 18-40 years, are eligible to join the scheme.

The applicant should not be covered under the New Pension Scheme (NPS), Employees' State Insurance Corporation scheme (ESIC) or the Employees' Provident Fund Organisation (EPFO). Further, he or she should not be an income-tax assessee.

Key features

The PMSYM is a voluntary and contributory pension scheme on a 50:50 basis, where a prescribed age-specific contribution is made by the beneficiary with a matching contribution by the Centre. For example, if a person enters the scheme at the age of 40, his or her monthly commitment would be Rs 200 till the age of 60 years.

Click here to read age-specific contribution details

Each subscriber will receive a minimum assured pension of Rs 3,000 per month on completion of 60 years of age.

Considering the uncertain nature of employability of these workers, the exit provisions of the scheme have been kept flexible.

If the subscriber exits the scheme in less than 10 years, the beneficiary's share of contribution only would be returned to him/ her with a savings bank interest rate. If the subscriber exits after a period of 10 years or more but before superannuation, his or her share of contribution along with accumulated interest actually earned by the fund or the savings bank interest rate, whichever is higher, would be returned.

During the course of contribution, if the subscriber defaults on payment, he/ she can regularise it by paying the entire outstanding dues, along with penalty charges, if any.

In case of the subscriber's death during the receipt of pension, the beneficiary’s spouse would be entitled to get 50 per cent of pension as family pension. Family pension is only applicable to the spouse and not the children.

Further, during the regular contribution period, if the subscriber dies, his/ her spouse would be entitled to continue or exit the scheme.

Enrolment process

For enrolment in the PMSYM scheme, investors should visit the nearest Common Services Centres (CSC eGovernance Services India Ltd) and enrol using their Aadhaar number and savings bank account/ Jan Dhan account numbers on self-certification basis. It can also be accessed on the PYSYM web portal or through a mobile app.

Unorganised sector workers can also approach LIC branches, the offices of ESIC/ EPFO and Central and state government labour offices for investment guidance.

Fund manager

It is a Centrally-sponsored scheme administered by the Labour Ministry and implemented through the Life Insurance Corporation and CSC eGovernance Services India Ltd. LIC is the Pension Fund Manager and is responsible for pension pay out.

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Published on April 29, 2019
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