Swavalamban scheme will merge with Atal Pension Yojana


Swavalamban scheme will merge with Atal Pension Yojana

In 2010-11, the UPA government announced a pension scheme directed at the unorganized sector of India and named it Swavalamban Yojana. The unorganized sector of the country comprises of over 88% of the total labour force that the country holds and this scheme was applicable to everyone in the unorganized sector who had joined the National Pension Scheme (NPS).

In May 2015, the current government under Prime Minister Narendra Modi’s leadership announced another pension scheme called Atal Pension Yojana (APY), again to aid the workers of the unorganized sector to help them voluntarily save for their life after retirement. This new Yojana has come into effect from 1st June 2015 and is supposed to replace the UPA government’s Swavalamban Yojana NPS Lite.

In simple terms, Atal Pension is a social security scheme that gives monetary security to people working in different fields without the security of old age pension.


The merge is taking place because the Swavalamban scheme could not find enough acceptance among people. Registered beneficiaries of the Swavalamban Yojana from the age group of 18 to 40 will automatically get transferred to Atal Pension Yojana with an option to exit. 


18 years is the minimum age of entering the APY, while 40 is the maximum age. However, the pension starts coming only after the individual reaches 60 years of age. Atal Pension Yojana offers a definite pension of Rs 1,000 to Rs 5,000 per month to its beneficiary, subject to contribution made by him/her.

Government contribution

Under APY, government contributes 50% of the total contribution or an amount of Rs 1000 per annum (whichever is less) to all those citizens who have opened accounts on or before 31st Dec, 2015. This contribution from the government lasts for 5 years from 2015-16 to 2019-20. However, there is term involved that needs to be fulfilled to avail the government contribution and the term is that the beneficiary should not be an income tax payer.

One important thing to note about the Atal Pension Yojana is that the beneficiary should not be covered under any legal social security scheme of government of India and only one account can be opened per individual. Another fact about APY is that in case of death of a beneficiary or terminal disease, premature withdrawal of money is allowed. Moreover, if the beneficiary discontinues payment, the account is termed frozen after 6 months, deactivated after 1 year and closed after 2 years. Nomination facility is allowed in APY and the subscriber can opt for nomination.

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