114259What problems are there with recycled mobile numbers?
As per PFRDA data dated 15th July, around 83.18% of enrolments under APY happened in the Rs 1,000 segment, which is the lowest slab. Only 10.62% of subscribers joined the highest slab i.e. Rs 5,000.
PFRDA chairman Deepak Mohanty recently highlighted the need to bring in more urban poor into India’s NPS (National Pension System) and APY (Atal Pension Yojana). To this effect, he has asked RRBs (Regional Rural Banks) to increasingly enroll urban business correspondents, so that they can reach out to such workers, who are generally laborers in unorganized sector, and get them into the system.
Under APY, the subscriber will start receiving a minimum pension amount, once he turns 60. The amount will depend on his contributions, and the payout can range from a minimum of Rs 1,000 to a maximum of Rs 5,000.
On considerations to push this Rs 5,000-limit further, Mohanty highlighted that there is no such plan in the near future. However, in order to bring greater pension coverage, PFRDA has asked RRBs to begin offering NPS.
According to Mohanty, it could be a beneficial scheme for farmers, given that their income is lumpy and seasonal, and NPS does not require regular monthly contributions.
NPS to breach the Rs 10-lakh crore mark
According to data, PFRDAs AUM currently stands at around Rs 9.8 crore. Mohanty underlined that this will most certainly grow over Rs 11 lakh crore by end of 2024.
APY not enough
The need for wider pension coverage is multi-pronged. As per PFRDA data dated 15th July, around 83.18% of enrolments under APY happened in the Rs 1,000 segment, which is the lowest slab. Only 10.62% of subscribers joined the highest slab i.e. Rs 5,000. The second biggest category was the Rs 2,000 segment, which made up 3.73% of the total base.
This is alarming, given that a meager monthly pension of Rs 1,000 or Rs 2,000 is clearly not going to suffice these individuals, mostly aged between 21-25 years, in their sunset years, which they will arrive at some 40 years from now. Moreover, there are minimal instances of people upgrading their slabs from Rs 1,000 to a higher one, even when their financial health allows, PFRDA data noted.
One silver lining in APY, as data noted, was the near-parity of men and women enrolled in the scheme. As of July 15, 2023, women constituted about 45.53% of APY subscribers, while men made up for 54.44% subscription. However, transgender enrolments stood at a paltry 0.03%, with only 14,931 subscribers out of APYs 5 crore + subscribers. As of July 15, total APY subscribers stood at 5,49,65,217.
Calling APY “a pension and investment” scheme rolled into one, Mohanty noted that PFRDA plans to target 25 crore eligible accounts, which belong to people aged 18-40, under the PMJDY scheme. However, it has set modest targets for achieving the same. For FY 2023-24, it aims to onboard 1.30 crore people. Last year, it managed to register 1.19 crore individuals. Mohanty highlighted that while the target was reserved, the RRBs, tasked with APY enrolments, have been consistently overachieving these goals. For the first quarter of FY 2023-24, APY added 27 lakh new subscribers to its base.