Atal Pension Yojana: Instant bank account verification to make premature exit easy

By: |
Updated: September 13, 2021 4:10 PM

Atal Pension Yojana Exit and Withdrawal Rules: The Pension Fund Regulatory and Development Authority (PFRDA) has proposed to introduce instant bank account verification

atal pension yojana exit rulesRepresentative image

Atal Pension Yojana Exit and Withdrawal Rules: The Pension Fund Regulatory and Development Authority (PFRDA) has proposed to introduce instant bank account verification in the interest of subscribers for orderly processing of their exit requests.

Atal Pension Yojana (APY) is the flagship Social Security Scheme of Government of India administered by PFRDA through Banks and Dept of Post. The scheme offers Guaranteed Pension Benefits to the eligible Indian Citizens after reaching the age of 60 years, who subscribe and contribute to the scheme.

The regulator has also issued guidelines for facilitating timely transfer of withdrawal amount in the bank account of APY subscribers:

1. If savings account details are same at the time of onboarding and exit

  • APY service provider should incorporate the field indicating active status of Savings Bank (SB) Account in the revised exit file format provided by CRA which is mandatory w.e.f. September 15th, 2021.
  • “Instant Bank Account verification by penny drop” shall be undertaken by CRA to verify the operative status of SB Account as part of enhanced due diligence.

“The above changes are being implemented to enable CRA system to process the premature withdrawal requests where the associated SB Account is operative so as to ensure receipt of APY account closure proceeds in the SB account,” PFRDA said in a circular dated 3rd September.

If the associated SB Account is closed/dormant, the modified process would ensure the preservation of Subscribers contribution in the PRAN itself to generate optimum market-based returns.

2. If the savings bank account details at the time on-boarding and exit are not same

  • APY service providers have been advised that the APY closure proceeds are credited to the same Bank Account number and may accept the request with different Account number or account of a different Bank only as an exception. Such requests are to be accompanied by proof of Alternate Account Number acceptable to the Bank.
  • “Instant Bank Account verification by penny drop” shall be undertaken by CRA as part of enhanced due diligence including the name matching between PRAN and Bank Account Number.
  • The exit requests with mismatches or with unsuccessful account verification, post penny drop is to be confirmed by the respective APY-SP for further processing of exit requests by CRA.

PFRDA said, “APY Subscribers are to be educated by APY-SP to keep their respective Bank account active when they submit their premature withdrawal request, till their request for premature withdrawal request is processed. A suitable undertaking can be obtained from the Subscriber as part of the withdrawal request.”

The applicable charges for Instant Bank Account verification would be recovered by CRA from the respective PRAN for further reimbursement to the service provider. The prevailing charges for verifying Bank Account Number through penny drop is Rs. 2.40 and tax, the regulator added.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, Check out latest IPO News, Best Performing IPOs, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.

Next Stories
1Can you opt for a home loan to construct your house?
2ESIC scheme adds 13.21 lakh new members in July 2021
3Do you need to pay advance tax on capital gains from shares, dividends?