Swavalamban for the Unorganized Sector
Swavalamban Yojana was last announced by the Government of India in General Budget 2010–11 with the objective of encouraging individuals from the unorganized sector to voluntarily save for their retirement. Under this model, individuals from economically weaker sections of the society can join the NPS in ‘groups’ through ‘aggregators’ (a set of grassroots intermediaries including state government entities, public sector banks, regional rural banks, microfinance institutions, non-banking finance companies and private sector entities as identified by the PFRDA). This model brings the disadvantaged sections into the mainstream of pension wealth. Under this model, the central government makes a contribution of Rs 1,000 per annum per account/ subscriber to all eligible Swavalamban accounts where the subscriber’s own contribution is between Rs 1,000 and Rs 12,000 per annum. The annuity pension payable every month is 100 per cent of the accumulated wealth in case the monthly pension payable falls below Rs 1,000 per month. Several state governments have adopted this scheme to cover building and construction workers, anganwadi workers and helpers, and other workers engaged in identified occupational groups. The idea is to incentivize voluntary participation of workers from the unorganized sector.