Govt mulls doubling Atal Pension Yojana payout cap to boost uptake, retention

Subscribe to enjoy similar stories.New Delhi: India is looking to strengthen the social security net for informal workers amid rising living costs for retirees. Under the plan, the finance ministry, in consultation with the Pension Fund Regulatory and Development Authority (PFRDA), is considering doubling the assured pension ceiling under the flagship Atal Pension Yojana (APY) to up to ₹10,000 a month, according to three people aware of the discussions.The proposal aims to boost fresh enrolments as well as retention in a scheme that now has 90 million subscribers but faces high drop-offs.Launched in May 2015, the pension scheme focuses on informal sector workers and currently provides a guaranteed monthly pension of ₹1,000-5,000 after the age of 60 years, depending on the subscriber’s contribution slab.With nearly half the enrolled subscribers discontinuing contributions over time, the government is examining a long pending demand to enhance the pension cap to up to ₹10,000 per month to make the scheme more attractive and aligned with rising living costs, according to the people cited above.The scheme's gross enrolments in FY26 crossed 13.5 million, the highest ever in a single fiscal year since its launch.“The government and the PFRDA are examining options to enhance the upper pension cap to around ₹8,000– ₹10,000 per month, aiming to make the scheme more attractive and aligned with rising living costs,” said one of the people cited above, requesting anonymity.Under the scheme's structure, the government provided a co-contribution in the initial years for subscribers enrolled before 31 March 2016.