How to apply Pradhan Mantri Vaya Vandana Yojana(PMVVY)

Pradhan Mantri Vaya Vandana Yojana (PMVVY) 

Pradhan Mantri Vaya Vandana Yojana is an insurance policy-cum- pension scheme that provides alternative avenues of income to senior citizens of the country. Backed by the Indian government, this pension plan is provided by Life Insurance Corporation (LIC) which caters to one’s need for post-retirement financial planning. Individuals, more than 60 years of age can avail this scheme. 

PMVVY, which was earlier available from 4th May 2017 to 31st March 2020, was recently (Govt. Press Release dated May 20, 2021) extended by the government for another three financial years till 31st March 2023. 

PMVVY gives a guaranteed pension payout at a specified rate for 10 years. This scheme will provide an assured return of 7.4 percent per annum which will be payable monthly for the entire duration of 10 years. 

Features and Benefits of PMVVY 

• Retirement financial security via pension payment 

Under Pradhan Mantri Vaya Vandana Yojana, individuals who have availed of this pension plan are allowed to receive a fixed amount at the end of a certain period chosen by an individual for a maximum term of 10 years. 

• Assurance of returns 

PM Vaya Vandana Yojana will initially provide an assured rate of return of 7.40 % per annum for the year 2020-21 per annum and thereafter to be reset every year. 

Annual reset of the assured rate of interest with effect from April 1st of the financial year in line with the revised rate of returns of Senior Citizens Saving Scheme (SCSS) up to a ceiling of 7.75% with a fresh appraisal of the scheme on breach of this threshold at any point. 

• Periodic payout options 

Individuals can opt for monthly, quarterly, half-yearly or annual payout with the plan as per their financial requirements and convenience. The first payment must be performed immediately after plan purchase, depending on one’s chosen payment mode. For example, if a pensioner has chosen quarterly mode of payment, he/she should receive the first payment within 3 months from the date of policy purchase. 

• Maturity benefit 

Pradhan Mantri Vy Vandna Yojna also comes with the maturity benefit of receiving a lump sum purchase price of the plan along with the last instalment payout. This facility is valid on the survival of a pensioner until this policy tenure’s end. 

• Death benefit 

In the event of a pensioner’s death during the policy term, his/her beneficiary is entitled to receive an entire purchase amount as a claim on submitting required documents. 

• Surrender value 

Considering the monetary requirement to avail the treatment of critical illnesses for self or spouse, this scheme also allows a pensioner to surrender the policy. Policyholders can receive 98% of the purchase value during premature exit from the policy term. 

• Free lock-in period 

After purchasing a policy, if individuals are not comfortable with the terms and conditions mentioned in the contract, they are allowed to return this scheme within 30 days from the date of receipt in case of online purchase. Yet, free lock-in period for offline purchase is 15 days starting from policy purchase date. A reason for objection must also be enclosed while returning this policy. 

• Loan facility 

After completing 3 successful policy years, individuals can avail loan against a Pradhan Mantri Vaya Vandana Yojana investment. Pensioners can borrow a maximum of 75% of the purchase amount as a loan. Interest calculated on loan is recovered from the pension payment as per the chosen frequency of loan repayment. The interest payable gets due on the pension payment date. 

Furthermore, during maturity or surrender, loan outstanding will be recovered from its claim amount. 


The pension-cum-insurance scheme also comes with a unique exclusion to this policy’s purchase price return. Under this exclusion, the entire purchase price is payable if a policyholder commits suicide. 

Eligibility Criteria for the PM Vaya Vandana Yojana 

Individuals can purchase Pradhan Mantri Vaya Vandana Yojana only after meeting the eligibility criteria determined by the government. Here is a list of criteria one needs to fulfil elucidated in a tabular format. 

Minimum Entry – 60 years

Maximum Entry – No limit

Policy Term – 10years

Minimum Pension

  • Rs.1,000 per month 
  • Rs.3,000 per quarter 
  • Rs.6,000 per half-year 
  • Rs.12,000 per year 

Maximum Pension Term 

  • Rs.10,000 per month 
  • Rs.30,000 per quarter 
  • Rs.60,000 per half-year 
  • Rs.1,20,000 per year 

While choosing a pension amount, individuals must consider the family’s size. Here, one’s family includes spouse and dependents such as an unmarried daughter and an unemployed son with a maximum age limit of up to 25 years of age. 

Purchase Price Payment for Different Periodic Payouts under PMVVY 

Interested individuals can purchase PMVVY scheme in monthly, quarterly, half-yearly or yearly payout mode by depositing the purchase price in a lump sum. A buyer can either select the purchase price or pension amount while opting for this plan. 

Check out the maximum and minimum purchase prices to better understand this scheme. 

Maximum purchase price under different modes of pension 

Mode of pension  – Maximum purchase – Corresponding pension amount price 

  • Yearly 14,49,086 to 1,11,000 per annum 
  • Half-yearly 14,76,064 to 55,500 per half-year 
  • Quarterly 14,89,933 27,750 per Qtr. 
  • Monthly 15,00,000 9,250 per month 

Minimum purchase price under different modes of pension 

Mode of pension  – Minimum purchase – Corresponding pension amount price 

  • Yearly 1,56,658 12,000 per annum 
  • Half-yearly 1,59,574 6,000 Half-year 
  • Quarterly 1,61,074 3,000 per Qtr. 
  • Monthly 1,62,162 1,000 per month 

Understand the working of this entire scheme with an example. For instance, Rajan has purchased this plan by investing a lump sum amount to secure a fixed income for the immediately following 10 years after his retirement/scheme purchase. 

Details of Rajan: 

  • Age when bought: 62 
  • Opted purchase price: Rs. 8 Lakh 
  • Policy term: 10 years 
  • Chosen pension payment mode: Monthly 
  • Date of receipt: 1st February 2020 
  • Beneficiary: Spouse 
  • Annual income: Rs. 6 Lakh Now, he is allowed to avail of benefits of Pradhan Mantri Vaya Vandana Yojana under the following instances. 

Benefits of Pension with Assurance 

The pension amount will be calculated on the purchase price, which is Rs. 9 Lakh, at a fixed rate of 8% per year up to the next 10 years. Furthermore, as Rajan has chosen a monthly payment mode, the entire yearly interest income will be divided by 12 and paid every month. 

Therefore, the pension amount arrived at is as follows. 

Thus, regardless of the market condition, Rajan receives Rs.6,000 as pension every month under this scheme up to either next 10 years or till he survives within this 10-year tenure. • Maturity benefit After a 10-year policy term completion, Rajan will receive Rs. 9 lakh that he paid while purchasing this plan. 

• Death benefit 

Unforeseen events like death can leave the dependents financially unstable. However, if the deceased is insured, then his/her dependent can remain financially covered. 

For instance, Rajan receives a pension amount of Rs. 6,000 till 66 years of his age. However, in the case of his unfortunate demise in his 66th year, his spouse will receive an entire purchase amount of Rs. 9 Lakh as a beneficiary. This benefit is valid only if his death occurs during the policy tenure. 

• Surrender value 

If Rajan requires funds in a lump sum anytime during the policy term, during an emergency like an urgent medical treatment either for himself or spouse, as per this scheme’s rules, he will receive 98% of his purchase price as a surrender value. In this case, where the purchase price stands at Rs. 9 Lakh, the surrender value will equate to Rs. 8,82,000, i.e., 98%. 

• Loan facility 

As another example, Rajan needs funds to renovate his house in the year 2024. So, he applies for a loan against his savings under Pradhan Mantri Vaya Vandana Yojana. As this policy has been successfully running for more than 3 years, he can avail 75% of Rs. 9 Lakh, i.e., this scheme’s purchase price amounting to Rs. 6,75,000 as loan. 

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How to Apply for the PMVVY Scheme 

Individuals can buy Pradhan Mantri Vaya Vandana Yojana both offline and online from Life Insurance Corporation of India. 

  • Offline 

To purchase this scheme through the offline mode, individuals need to approach the nearest or preferred branch of LIC. After deciding the preferred purchase price or pension payment, individuals need to fill up the application form and submit it along with required documents and the chosen amount. 

  • Online 

For hassle-free application process, individuals can apply for Pradhan Mantri Vaya Vandana Yojana online through the following steps. Visit the official website to apply “Click Here

Step 1: Visit the official website of the Life Insurance Corporation of India. 

Step 2: Next, under ‘Buy Policy Online’ header, click on the “Pradhan Mantri Vaya Vandana Yojana” option. 

Step 3: A new tab will open with four different options. Now, click on the designated button no. 842 for the ‘Buy Online’ option. A new page will appear on the screen where you have to select the ‘Click to Buy Online’ option on the left side corner of the page. 

Step 4: In the next step, create an Access ID to proceed further. Provide contact details such as name, email ID, mobile number, date of birth, address and servicing unit to generate the ID. You will receive this 9 digit Access ID either by SMS at the registered mobile number or through email. 

Step 5: Next, submit the Access ID and hit the ‘Proceed’ button to go forward with the application. 

Step 6: At last, after selecting the preferred pension plan under Pradhan Mantri Vaya Vandana Yojana, fill up the application form, and upload scanned copies of the required documents and make payment. After successful submission of the application form, you will be provided with an acknowledgement and policy number. 

Also read, Pradhan Mantri Fasal Bima Yojana Telugu

Required Documents to Apply for Pradhan Mantri Vaya Vandana Yojana(PMVVY) – 

To apply for the pension scheme, individuals need to submit a handful of essential documents like — 

  • Aadhaar card 
  • PAN card 
  • Details of the preferred bank where the pensioner wants the pension to be credited every month. 

Individuals purchasing the pension scheme need to be careful about the date of receipt, date of risk commencement, date when the policy was revived if any and the date of adding riders if any. 

FAQs – 

Can anyone invest in both PMVVY as well as SCSS? 

Yes, individuals can invest Rs. 15 Lakh in each of the saving schemes at the same time. Thus, Rs. 30 Lakh can be invested in two schemes together. Both of the investment avenues are backed by the government and come with a substantial return. 

Is the rate of interest fixed for this pension scheme? 

Yes, the rate of interest is fixed at 8 – 8.30% per year. To provide financial stability to senior citizen, the government has determined the interest rate regardless of the market vulnerability. 

What are the benefits of Pradhan Mantri Vaya Vandana Yojana in case an investor needs funds in an emergency or after his/her demise? 

The scheme provides death benefits as a refund of the entire purchasing price to the beneficiary in the case of a pensioner’s demise during the policy term. It also provides the facility of premature exit with a withdrawal of 98% of the deposit amount if a policyholder requires funds for the treatment of any critical diseases he/she or the spouse suffers. 

Visit the official website to apply “Click Here

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