Atal Pension Yojana Maximum Limit: The hike in maximum limit to Rs 10,000 has been a long-pending proposal of the pension regulator.
Atal Pension Yojana 2020: The maximum pension limit for an individual APY subscriber may increase to Rs 10,000 if the Central government accepts a proposal of the Pension Fund Regulatory and Development Authority (PFRDA). With around 2 crore subscribers since launch in 2015, this flagship scheme of Narendra Modi has been slow in gaining popularity. The maximum pension limit of Rs 5000 for an individual puts off many interested potential subscribers. However, increasing this limit to Rs 10,000 can certainly boost the popularity of the scheme fast.
The hike in maximum limit to Rs 10,000 has been a long-pending proposal of the pension regulator. In June 2019, Madnesh Kumar Mishra, Joint Secretary, Department of Financial Services (DFS), was quoted as saying by PTI, “”We have seen the proposal (sent by PFRDA) of increasing the pension value to (up to) Rs 10,000 per month and it is under our active examination.”
PFRDA Chairman Hemant G Contractor had then said, “Currently, we have five slabs of pension from Rs 1,000-5000 per month. There have been a lot of feedback from the market asking for higher pension amounts because many people feel that Rs 5,000 at the age of 60 years, 20-30 years from now, will not be sufficient. We have placed this proposal with the government that it should be increased to up to Rs 10,000.”
Last month, PFRDA Whole Time Member Supratim Bandyopadhyay, told the news agency, “We have been asking for increasing the age limit for subscription under Atal Pension Yojana (APY) from 40 to 60 years. And also to increase the pension limit from existing Rs 5,000 a month to Rs 10,000 per month under APY.”
Raising the maximum limit of APY can help individuals subscribers in the lower-income groups ensure a monthly pension of Rs 10,000. In fact, a married couple will be able to ensure monthly combined pension of Rs 20,000 if the government hikes the current maximum limit and doesn’t change other rules of the scheme. Wondering, how?
Well, the current APY rules allows all eligible subscribers in a family to apply for the scheme. This means a married couple can open two accounts in their names separately to get a monthly pension of Rs 10,000 each if the current limit is hiked.
As per current rules, if a married couple aged 30 years each apply for the scheme, they will need to contribute Rs 577 per month separately in their respective APY accounts for the maximum pension of Rs 5000. Their combined daily contribution towards respective APY accounts comes would be Rs 577×2/30= Rs 38.4. If the limit is hiked to Rs 10,000, their separate contributions to APY will be Rs 577×2 = Rs 1154/month.