Karnataka banks still fail to meet targets set for penetration of Atal Pension Yojana

Bengaluru: Most banks in Karnataka are struggling to meet the targets of the pension scheme designed for the unorganised sector – Atal Pension Yojana. If banks failed to deliver the expected results in the last fiscal, this year will be no different, a briefing aimed at improving the scheme’s reach, conducted by the State Level Bankers’ Committee (SLBC), Karnataka and Pension Fund Regulatory and Development Authority (PFRDA) on Friday, revealed.

Barring a handful of bankers who attended the meeting, most reported that they were significantly off target. IDBI Bank said that while it achieved 51% of its target in fiscal 2024, it had barely met 12% of its target for the current fiscal year, as of July 31. HDFC Bank hopes to cross 15% of its target of 31,360 by the end of this month, after hitting 3,200 beneficiary enrolments.

Punjab National Bank and UCO Bank are among the banks whose ratios are still at 1 per cent of the target (as of July 31).

Mamta Shankar, full-time member of economics at the Pension Fund Regulatory and Development Authority (PFRDA), said they expect higher profits from banks in urban areas, which have been doing worse than those in rural areas.

Karnataka Grameena Bank (KGB) is at 65 per cent (as of July 31) and aims to achieve its target by September 15. KGB managed to achieve 85 per cent in FY24. Among those that have already exceeded their target are Karnataka Vikas Grameena Bank at 119 per cent and Kotak Mahindra Bank at 157 per cent.

A bank official present at the meeting, who wished to remain anonymous, noted that some banks are reluctant to take on the task because their employees are not motivated or assessed for it, even though it involves a lot of work to persuade people to take up the pension scheme.

Atal Pension Yojana, launched in 2015, is a guaranteed pension scheme of the Government of India available to Indian citizens between the ages of 18 and 40. It aims to provide an income in old age, especially for those in the unincorporated sector.