CHENNAI: In a bid to enhance the outreach of subscribers under Atal Pension Yojana (APY), the government on Friday allowed small finance banks and payments banks to sell the scheme to their subscribers. Earlier, it was sold through bank branches and post offices. This move will also enable the regulatory body PFRDA to meet the target of one crore subscribers by March 2018.
Given the strength, expertise and reach of these new-age banks, they can play a pivotal role in strengthening the existing channels of APY distribution and boost outreach of subscribers under APY, the finance ministry said in a statement.
“Participation in APY not only builds a pensioned society but also adds sustainable fee income to banks by way of attractive incentive for mobilising Rs 120-150 for each APY Account,” the ministry noted. Currently, there are 11 payments banks and 10 small finance banks.
“As permitted by PFRDA, we plan to aggressively promote Atal Pension Yojana,” said K Paul Thomas, chairman of ESAF Microfinance. There are more than three lakh subscribers under Swavalamban Pension Yojana, of which nearly 50 per cent of them are eligible to convert to APY. “We expect to convert at least 1.47 lakh SPY subscribers to APY,” Thomas told Express.
APY, which became operational from June 1, 2015, 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 Rs 1,000 to Rs 5,000 a month, depending on his or her contribution, upon reaching the age of 60 years.
APY follows the same investment pattern as applicable to the NPS contribution of central government employees. During 2016-17, it earned a return of 13.91 percent, according to PFRDA.Overall, there are 84 lakh subscribers registered under the APY scheme with an asset base of Rs 3,194 crore. Uttar Pradesh is the highest contributing state at 11.41 lakh APY subscribers.