In an event held by PFRDA earlier this year, the Ministry of Finance stated that it expects to increase the number of subscription under Atal Pension Yojana (APY) to 1 crore(read more). At present, there are 69 lacs subscribers under this scheme which are mainly from the organised sector. Thus if more people from the unorganised sector can be included under the scheme the number of subscribers will definitely rise to its expected goal by next year.
In a recent conference on Atal Pension Yojana held on 16, October 2016, PFRDA Chairman, Shri Hemant. G Contractor emphasised the need of increasing the pension coverage in India. It was initiated by Pension Fund Regulatory and Development Authority (PFRDA) in the national capital. The conference saw a participation of key dignitaries from all major banks, NPCI, SCHIL, SIDBI, Access Assist and few major MFIs. Mr Hemant further highlighted the fact that while APY has been successful in covering the intended subscribers but much needs to be done.While talking about the progress made by the scheme he added that a little less than 2 % of the eligible population is covered under APY. Thus he stated that a lot needs to be done to help people to have regular access to old age income.
Atal Pension Yojana is a flagship program initiated by the government to provide financial security to ageing people. Further, the scheme also aims at increasing savings amongst middle and lower income middle class section of the society. As under this plan, the subscribers will be given regular pension once they turn 60 years old, depending on the amount they have invested and tenure. While talking about the significance of the scheme, PFRDA chairman touched on the topic of APY accounts and held that the objective of the scheme can only be achieved if the contribution to the accounts is paid on a regular basis.
The aim of the conference was to deliberate on the scope and broader objectives of the Atal Pension Yojana (APY) scheme and discuss the way forward for the greater coverage under the scheme.
A video message by the Secretary of DFS, Shri Rajiv Kumar was played on the occasion. He remarked that while Atal Pension Yojana is a flagship program for financial inclusion and financial security, only 12% of the population is covered under the pension scheme. He congratulated the banks on their performance under the scheme and encouraged them to continue the work. He also emphasised the importance of e-APY, which is a digital platform for APY by PFRDA and stated that the performance of the banks under this scheme will be monitored by the DFS. He further held that the targets under this scheme must be accomplished.
It must be noted that the old age section of the society is the fastest growing demographic in the country. This became possible with the increase in longevity of people due to inventions of new medicines, better medical equipment, increase in hospitals etc. Further with the increasing shift to the nuclear family system from the joint family system, there is a greater need for old age security than ever before. At present, 110 million people in India are above 60 years of age which will increase up to 180 million by 2030.
Atal Pension Yojana is a self-regulatory scheme with a very low contribution by the subscribers. As per the saving capacity of the subscriber, APY has the option to increase the pension amount from rupees 1000 to any amount up to rupees 5000. The scheme further allows the spouse to continue to contribute to the account in case of death of the subscriber before attaining the age of 60 years.
PFRDA has been continuously making efforts for financial inclusion of people even in the interior parts of the country. At present, the pension scheme is mainly available to the organised sector. Efforts like opening a digital platform like e-APY and encouraging various state governments to contribute under the scheme has been made on the part of PFRDA. The introduction e-APY will help various banks under this scheme for the greater financial inclusion of the country. Recently, the government of India has also made Aadhaar mandatory in order to avail all government schemes. This is also mandatory for all APY subscribers. This will help in identifying the targeted section of the society.