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Pradhan Mantri Shram Yogi Maandhan Yojana – IMPRI Impact And Policy Research Institute

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Policy Update
Akanksha Baronia

INTRODUCTION

Unorganised Workers are mostly engaged as home-based workers, street vendors, mid-day meal workers, head loaders, brick kiln workers, etc. As per the e-Shram portal, there are over 30.51 crore unorganised workers registered, as on 31 December 2024. Pradhan Mantri Shram Yogi Maan Dhan was introduced in the Interim Budget 2019. The scheme is administered by the Ministry of Labour and Employment in collaboration with Life Insurance Corporation of India(LIC) and Common Service Centres e-Governance Services India Limited for seamless implementation.The scheme is a part of the government’s broader social security initiatives and aligns with the vision of universal pension coverage for workers in the unorganised sector.

KEY FEATURES OF PM-SYM

The Pradhan Mantri Shram Yogi Maandhan scheme provides numer benefits, ensuring financial security in old age for unorganised sector workers.

Minimum Assured Pension: ₹3000 per month after 60 years of age.

Government Contribution: The Government of India matches the worker’s contribution on a 1:1 basis.

Voluntary and Contributory: The scheme is voluntary, allowing workers to contribute based on their affordability and requirement.

Family Pension: If the beneficiary passes away, the spouse receives 50% of the pension amount as a family pension. Family pension is applicable only to spouse.

Exit Provisions: Participants can exit the scheme under specified conditions.

Easy Enrolment: Eligible workers can register at Common Service Centres or through the Maandhan portal.

Fund Management: The scheme is administered by LIC, ensuring financial stability and credibility.

FUNCTIONING 

To enroll in PM-SYM, individuals must meet the following eligibility conditions:

  1. Age Requirement: 18 to 40 years.
  2. Income Limit: Monthly income should be ₹15000 or less.
  3. Unorganised Sector Employment: Workers engaged in professions such as: 

            Street vendors, rag pickers, rickshaw pullers

            Construction workers, daily wage labourers 

            Agricultural workers, beedi workers

            Domestic workers, weavers, etc.

  1. Exclusion Criteria: Should not be covered under the Employees Provident Fund , Employees State Insurance Corporation, or National Pension Scheme.

            Should not be receiving benefits from any other government pension scheme.

  1. Documents required: Aadhaar Card, Savings bank account or Jan Dhan account details with IFSC, Mobile number.
  2. List of professions/occupations covered under this scheme can be accessed at: https://labour.gov.in/list-professions-occupations-covered

Contribution Structure 

The contribution amount varies based on the age at the time of enrolment. The earlier a worker enrolls, the lower the monthly contribution.

image 15

Source: made by author

IMPLEMENTATION 

  1. Holding periodic review meeting with States/UTs.
  2. Regular meeting with state Common Services Centre heads.
  3. Launch of new features such as Voluntary exit, Revival Module, Claim Status and Account Statement.
  4. Extension of revival of dormant accounts from 1 year to 3 years.
  5. Two way integration of PM-SYM and e-Shram.
  6. SMS campaign to create awareness.
  7. Communication with Chief Secretaries of States/UTs regarding enrolment under PM-SYM scheme.
  8. Launch of Donate-a-Pension Module to encourage the employer to pay the premium of their staff under PM-SYM pension scheme and increase the enrolment.
  9. Interaction with Department of Financial Services, Pension Fund Regulatory and Development Authority, National Institute of Public Finance and Policy to increase the outreach of the pension scheme.
image 15image 15

Source: made by author

IMPACT 

  1. Contribution by Government Doubles Worker’s Savings: The matching contribution by the government towards this scheme increases worker’s pension savings and more profitable and attractive than any self funded scheme.

            For example- a 27 year old worker contributing ₹200 and an equal and 

            matching contribution by the government doubles worker’s pension amount.

  1. Expanded Coverage: As of March 2025, approximately 46.12 lakh unorganised workers have enrolled in the scheme across 36 States and Union Territories.

            Top Participating States: Haryana, Uttar Pradesh, and Maharashtra lead in 

             the number of enrolments.

  1. Benefits for the family: In case the enrolled worker dies, the spouse receives 50% of the pension as a family benefit, ensuring continued support for surviving dependents. This family pension improves household resilience against income shocks due to death of the primary earner.
  2. Financial Inclusion: Encourages workers to open bank account and savings account to increase the savings culture and thereby improving the financial discipline. This aligns with broader initiatives like Jan Dhan Yojana and Digital India.
  3. Social Security for the Unorganised Sector: For the first time, millions of unorganised workers- such as street vendors, agricultural labourers, construction workers, and domestic helpers got access to the formal pension system. This scheme guarantees ₹3000/month guaranteed pension after age 60, giving financial stability in old age and reducing dependence on family or informal support.
  4. Increased Budget Allocation: The 2025-26 Budget for PM-SYM saw a 37% increase compared to the previous year, highlighting the government’s commitment to social security.

CHALLENGES 

  1. The PM-SYM scheme has seen dismal performance due to low enrolment and reduced government funding.
  2. Constraints faced by workers: Only 17,175 informal workers have registered for the scheme so far which averages 3435 workers a month, compared with an average enrolment of 10,843 per month in FY21. The drop comes as workers in the unorganised sector faced job and income instability following the COVID-19 outbreak. People in the lower rung of the income category who are the targeted beneficiaries of the scheme were the worst affected by the two waves of the pandemic.
  3. Poor response: The scheme has received a poor response since its inception. A little over 4.5 million workers have registered against a target of 100 million unorganised workers in five years, or an average of 20 million workers a year.
  4. Dependence on digital infrastructure: India still witnesses a significant digital divide as can be seen from the latest data from the Telecom Regulatory Authority of India. A 2017-18 NSO survey found that only 18.4% of persons aged 15 and above were able to operate a computer, while only 22.9% were able to use the internet. Now, the unorganised workers constitute around 93% of India’s labour force. Thus, even those who may have a smartphone through which they can access the portal might not be digitally literate enough to adequately navigate and understand how the portal works.
  5. Fragmented Schemes & Overlapping options: Other pension schemes like Atal Pension Yojana may confuse beneficiaries, reducing the attractiveness of PM-SYM.

WAY FORWARD 

A report by the Ministry of Labour and Employment recommends for the constitution of the district level implementation committee and setting targets to achieve higher rate of enrolment of unorganised worker subscribers under the scheme. The Service rendered by the common service centres in terms of the enrolling the unorganised workers under various social security schemes including PM-SYM should be under scrutiny of the State Labour Department.

It recommends that the existing income limit for an eligible subscriber should be increased to ₹18000 per month. Further, the entry age limit to get enrolled under the PM-SYM should be increased from 18 to 50 years as similar to Pradhan Mantri Jeevan Jyoti Bima Yojana. In view of the consumption and production needs of the unorganised workers, micro credit provisions for the unorganised worker subscribers should be included. Finally, it is recommended that training and capacity building programmes should be organized for the village level entrepreneurs running common service centres for effective implementation of the scheme.

REFERENCES 

  1. Press Information Bureau https://share.google/pQnYnjlb2PiICRR9i
  2. https://aimindia.in/pradhan-mantri-shram-yogi-maandhan-yojana/?utm_
  3. https://www.usthadian.com/pradhan-mantri-shram-yogi-maandhan-pm-sym-a-pension-safety-net-for-indias-informal-workers/?utm_source
  4. Money control https://www.moneycontrol.com/news/business/explained-pradhan-mantri-shram-yogi-maandhan-and-why-enrollments-have-fallen-7461761.html?utm_source
  5. https://www.reddit.com/r/india/comments/pfp4bc/the_e_shram_portal_an_explainer/?utm_source

About the Author:

Akanksha Baronia is currently pursuing her postgraduate degree in Economics from Jawaharlal Nehru University. She is a research intern at IMPRI.

Acknowledgement:

The Author thanks Aasthaba Jadeja and other IMPRI members for their valuable contribution.

Disclaimer: 

All views expressed in the article belong solely to the author and not necessarily to the organization.

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