THE SARAL GUIDE
Atal Pension Yojana (APY): Eligibility, Monthly Contribution Chart, Pension and How to Join
A plain-language guide to Atal Pension Yojana: who can join, the monthly contribution for a pension of ₹1,000 to ₹5,000, what the spouse and nominee get, exit rules and how to enrol at your bank.
Atal Pension Yojana (APY) is a government pension scheme mainly for people who work outside the organised sector, such as domestic workers, drivers, farm workers and small shopkeepers. You save a small fixed amount every month and, from age 60, you receive a guaranteed monthly pension of ₹1,000 to ₹5,000, whichever you choose when you join. It is run by the Pension Fund Regulatory and Development Authority (PFRDA) and started in May 2015.
The key points
- You must be an Indian citizen aged 18 to 40 and have a savings bank account.
- A person who is or has been an income tax payer cannot join.
- You choose a monthly pension of ₹1,000, ₹2,000, ₹3,000, ₹4,000 or ₹5,000. It starts at age 60.
- The earlier you join, the smaller your monthly contribution.
- The contribution is auto-debited from your bank account.
- After you, your spouse gets the same pension. After both of you, the saved corpus goes to your nominee.
How much will you have to pay?
The amount depends on your age when you join and the pension you want. These are the monthly contributions for the smallest and the largest pension:
| Age when you join | For ₹1,000 pension | For ₹5,000 pension |
|---|---|---|
| 18 | ₹42 a month | ₹210 a month |
| 30 | ₹116 a month | ₹577 a month |
| 40 | ₹291 a month | ₹1,454 a month |
Other ages and pension amounts fall in between. Your bank shows the exact figure when you apply, and the contribution can also be paid quarterly or half-yearly, which changes the instalment amount slightly.
What happens at 60 and afterwards
- From age 60 you receive the guaranteed pension every month for life.
- If you die, your spouse receives the same pension for life.
- When both of you have died, the corpus built up at age 60 is paid to your nominee. This is about ₹1.7 lakh for a ₹1,000 pension and about ₹8.5 lakh for a ₹5,000 pension.
- If you die before 60, your spouse can continue the account and keep paying until you would have turned 60, or close it and take the savings with interest.
Charges, late payment and exit
- Charges: a small account-opening fee and annual account maintenance charge, both reported to be about ₹15. Your bank may charge a little more, so ask.
- Late payment: the bank charges a small penalty for each month’s delay. If payments stay missed for long, the account can be frozen and then closed.
- Leaving early: you can normally exit only at 60. Before that, exit is allowed only in special cases such as the death of the subscriber or a terminal illness. A voluntary exit before 60 returns only what you paid plus the interest earned, less charges, and you lose the guaranteed pension.
- Make sure the bank account always has the money on the debit date. This is the most common reason for penalties.
How to join
Take your Aadhaar, mobile number, nominee details and savings account details.
- Go to the bank where you have your savings account, or a post office, and ask for the APY form. Many banks also offer it in net banking or mobile banking.
- Choose the pension amount, give your nominee and spouse details, and agree to auto-debit.
- Your Aadhaar and mobile number are used for verification.
- You receive a confirmation message with your account number. Keep it safe.
- The first instalment is debited on the due date every month.
Is APY a good fit for you?
- Good fit: you have no other pension, you want a guaranteed amount, and you can pay a small fixed amount every month for decades.
- Think twice: the pension amount is fixed. After 30 or 40 years prices will be higher, so ₹5,000 will buy less than it does today. You may want to add other savings such as NPS or PPF if you can.
- Not eligible: income tax payers and people older than 40.
Sources
- Pension Fund Regulatory and Development Authority (PFRDA)
- Outlook Money: Atal Pension Yojana explained
- Federal Bank: Atal Pension Yojana
Last checked: 27 October 2026. Contribution amounts and rules can change, so confirm the exact figures with your bank or PFRDA before you join. This guide is general information, not financial advice.