“Any upside above assured pension is completely with the beneficiary,” she noted. There were 4.53 crore subscribers under the scheme till March 4. Sitharaman observed that the feature under APY to automatically continue the premium payment unless the subscriber opts out is deliberate and a beneficial feature which is in the best interest of the subscribers.
“Instead of requiring people to decide each year to continue, they have to take a decision to discontinue. This makes many of them take the right decision and save for their retirement,” she noted adding that APY maintains a robust communication channel with its subscribers. “Regular updates are sent via messages, ensuring that subscribers are well-informed about their accounts and the scheme’s details,” she said in her post.
The FM observed that the minimum return under the APY is guaranteed by the government to be at least 8%, regardless of prevailing interest rates and returns. “GoI pays a subsidy to PFRDA to make up for any shortfall in actual returns. If higher investment returns are received on the contributions of subscribers of APY, higher pension would be paid to the subscribers,” she said. Sitharaman said that for a subsidised scheme intended for the poor and lower middle class, it is obvious that the majority of pension accounts in lower slabs. “In fact, it shows the proper targeting of the scheme. If the offtake was at the higher end, that would be surprising,” she observed.
