PFRDA proposes changes in premature exit rules for Atal Pension Yojana

APY is a social security scheme administered by PFRDA through Banks and Department of Posts. The scheme provides guaranteed pension benefits to eligible citizens who subscribe and contribute to the scheme after reaching the age of 60 years.

According to a PFRDA circular issued on September 3, “The existing mode of premature withdrawal under APY is examined by PFRDA from time to time based on inputs/suggestions received from various stakeholders and changes are proposed with suitable technical interventions.” Huh.”

The scheme will introduce instant bank account verification in the interest of the underlying customers for orderly processing of their exit requests.

In order to facilitate timely transfer of withdrawal amount to the bank account of APY customers and as an additional due diligence to safeguard their corpus lying in Permanent Retirement Account Number (PRAN), the following guidelines have been issued.

There can be two scenarios at the time of exit which are explained as follows:

A. If the SB account details of the customers are same at the time of onboarding and exit

1. The APY Subscriber should include the field indicating the active status of the Savings Bank (SB) account in the revised exit file format provided by CRA which is mandatory with effect from September 15, 2021.

2. As part of the enhanced due diligence, instant bank account verification by penny drop will also be done by the CRA to verify the operational status of the savings account.

3. The above changes are being implemented to enable the CRA system to process premature withdrawal requests where the linked SB account is operated so as to ensure receipt of APY account closure proceeds in the SB account as per PFRDA circular.

4. In case the linked savings account is closed / dormant, the revised process ensures conservation of the subscriber’s contribution in the PRAN itself to generate optimum market-based returns.

NS. If the savings account details are not the same at the time of onboarding and exit, different account numbers of the same bank or different bank

1. Subscribers are advised to deposit the APY closure amount in the same bank account number and may accept requests only with a different account number or account of a different bank as an exception. Such requests should be accompanied by a proof of alternate account number acceptable to the bank as per PFRDA circular.

2. As part of enhanced due diligence including name matching between PRAN and bank account number, instant bank account verification will be done by penny drop by CRA.

3. Exit requests with mismatched or unsuccessful account verifications, as per the circular, have to be confirmed post penny drop by the concerned APY customer for further processing of exit requests by the CRA.

4. Subscribers should be educated to keep their respective bank account active when they submit their premature withdrawal request and the request is processed. A suitable commitment may be obtained from the customer as part of the withdrawal request.

5. The applicable charges for instant bank account verification will be recovered by the CRA from the concerned PRAN for reimbursement to the service provider. As per PFRDA circular, the prevailing fee for verifying bank account number through penny drop is Rs 2.40 plus taxes.