Pradhan Mantri Kisan Maandhan Yojana (PM-KMY)
What is PM-KMY and Why Was It Launched?
In rural India, a large number of small and marginal farmers (SMFs) spend their lives doing hard manual labour. But after the age of 60, they often have no fixed income, no job security, and no savings to rely upon. PM-KMY is a step toward providing social security in old age—a pension scheme to ensure dignity and financial stability for such farmers.
Quick Facts Overview
| Feature | Details |
| Type | Central Sector Scheme |
| Launch Year | 2019 |
| Purpose | Pension support for old age livelihood of SMFs |
| Eligibility | Small & marginal farmers with landholding up to 2 hectares, aged 18–40 years |
| Fund Manager | LIC (Life Insurance Corporation of India) |
Objective
To provide assured, monthly pension of ₹3,000 after the age of 60 to eligible small and marginal farmers so they do not depend on others during their old age.
This addresses rural vulnerability, intergenerational dependence, and enhances dignity of aging farmers.
Salient Features Explained
1. Voluntary and Contributory Nature
- It is not mandatory—farmers can choose to join.
- Based on age at entry, farmers contribute a fixed monthly amount:
| Entry Age | Monthly Contribution |
| 18 years | ₹55 |
| 40 years | ₹200 |
- Central Government matches this contribution rupee for rupee, making it a co-contributory scheme.
2. Assured Pension Benefits
- Upon turning 60 years, the farmer gets a fixed pension of ₹3,000/month.
- Pension is deposited monthly into the bank account, managed through LIC’s Pension Fund.
3. Family Pension Provision
- If the subscriber dies after 60, the spouse gets 50% of the pension amount.
- It is a family-centric safety net.
4. Disability Benefits
- If the farmer becomes permanently disabledbefore 60:
- Spouse can continue in the scheme OR
- Spouse may exit and receive the total contribution (with either savings bank interest rate or actual returns from the fund—whichever is higher).
5. Exit Provisions
📍 Premature Exit (within 10 years of joining):
- Farmer gets own contribution + savings bank interest rate.
📍 Exit After 10 Years but Before 60:
- Farmer gets own contribution with either bank rate or actual fund interest, whichever is higher.
🔁 Thus, the scheme ensures flexibility and doesn’t penalize exit harshly.
❌ Exclusion Criteria
Some categories are excluded to ensure that the benefit reaches only vulnerable, low-income farmers:
Excluded Individuals
- Institutional landholders
- Ministers, MPs, MLAs, Local Body representatives
- Income tax payees in last AY
- Doctors, Engineers, Lawyers, CAs, Architects, etc.
- Government/PSE employees (except Group D/MTS/Class IV)
- Those already covered under statutory pension schemes like NPS
🏛️ Role of LIC
- LIC acts as the fund manager, handling subscriptions, pensions, payouts, and interest calculations.
- Ensures professional fund management and transparency.
Why Is It Important for UPSC?
This scheme reflects:
- Article 41 (DPSP) – Right to public assistance in old age
- Sustainable Development Goals – End poverty in all forms, ensure social protection
- Budgetary initiatives on rural welfare and inclusive development
It’s a great case study for:
- GS-2 (Welfare schemes for vulnerable sections)
- GS-3 (Agriculture, inclusive growth)
📌 Summary in One Line
PM-KMY is a government-backed, co-contributory pension scheme aimed at ensuring dignified aging for small and marginal farmers by offering them ₹3,000/month pension after 60 years of age.