To Strenghten the existing channel of Atal Penson Yojna (APY) the Union Government has allowed Small Finance Banks (SFBs) and Payments Banks to offer Atal penson Yojna. According to the Finance Ministry, the strength, expertise and reach of these new age banks can play a pivotal role in outreach of subscribers under APY. The ministry also said that participation in APY not only builds a pensioned society but also adds sustainable fee income to banks by way of attractive incentive for mobilizing Rs 120-150 for each APY Account.
What is Atal Pension Yojana?
- Atal Pension Yojana (APY) is a Government of India’s Old Age Pension Scheme.
- The Union Finance Minister has announced a new scheme called Atal Pension Yojana (APY) in 2015-16 budget.
- Accordingly, the Prime Minister, Shri Narendra Modi had launched the Atal Pension Yojana (APY) Scheme on 9th May 2015 and dedicated the First Ever Guaranteed Pension Product to the people of the country.
- It is being implemented through all Banks across the country as per the mandate received from the Ministry of Finance and monitored periodically at PMO.
- This scheme is administered by the Pension Fund Regulatory and Development Authority (PFRDA) through National Pension Scheme architecture.
- Under the scheme, there is guaranteed minimum monthly pension for the subscribers ranging between Rs. 1000 and Rs. 5000 per month.
- The Central Government will also co-contribute 50% of the subscriber’s contribution or Rs. 1000 per annum, whichever is lower. Government co-contribution is available for those who are not covered by any Statutory Social Security Schemes and is not income tax payer.
- Atal Pension Yojana is applicable to all citizen of India aged between 18-40 years.
About Payments Banks
- On the recommendation of Nachiket Mor committee, Reserve Bank of India issued guidelines for setting up Payments banks in India.
- The main objective of Payments bank is; to widen the spread of payment and financial services to low-income households, small business, migrant labourers Payment banks.
- Payment Banks can accept demand deposits upto one lakh rupees but it can not advance loans or issue credit cards.
- Airtel Payments Bank is the first Payments Bank to be launched in Rajasthan on 23 November 2016.
- Currently four Payments Banks have started their banking operation. These are;
1. Paytm Payments Bank.
2. Airtel Payments Bank.
3. India Post Payments Bank.
4. Fino Payments Bank.
What are Small Finance Banks
- On the recommendation of Raghuram R. Rajan Committee the Reserve Bank of India (RBI) on September 16, 2015, gave grant ‘in-principle’ approval to the 10 applicants to set up small finance banks under the ‘Guidelines for Licensing of Small Finance Banks in the private sector (Guidelines) issued on November 27, 2014.
- Like commercial banks the small finance banks can provide basic banking services like accepting deposits and lending to the unbanked sections such as small farmers, micro business enterprises, micro and small industries and unorganised sector entities.
- Currently the below mentioned Small Finance Banks have started banking operations:
1. Ujjivan Small Finance Bank.
2. Janalakshmi Small Finance Bank.
3. Equitas Small Finance Bank.
4. A U Small Finance Bank.
5. Capital Small Finance Bank.
6. ESAF Small Finance Bank.
7. Utkarsh Small Finance Bank.
8. Suryoday Small Finance Bank.
9. Fincare Small Finance Bank.
