What is Sukanya Samriddhi Yojana (SSY)? A Complete Guide

The Sukanya Samriddhi Yojana (SSY) is a government-backed savings scheme designed to promote the financial security and well-being of a girl child in India. Launched in 2015 under the Beti Bachao Beti Padhao initiative, SSY aims to encourage long-term savings for a girl child’s education and marriage by offering attractive interest rates and tax benefits.

Benefits of Sukanya Samriddhi Yojana

• High-Interest Rate: The SSY scheme offers one of the highest interest rates among small savings schemes, making it an attractive option for parents or guardians.
• Safety: Being a government-backed savings scheme for girls, SSY is considered a secure investment.
• Tax Benefits: Contributions to the scheme qualify for tax deduction under Section 80C of the Income Tax Act, up to a maximum of Rs 1.5 lakh per year.
• Compounding: The interest earned is compounded annually, which helps to maximise the investment over time.

Sukanya Samriddhi Yojana Interest Rate

As of now, the interest rate for SSY is 8.2 % per annum. The government reviews and revises the interest rates quarterly, depending on economic conditions and other fiscal factors.

How to Calculate Interest on Sukanya Samriddhi Yojana

The interest on an SSY account is calculated based on the lowest balance in the account between the 5th and the last day of each month. The accumulated interest is credited annually at the end of the financial year. To estimate your potential returns, you can use online Sukanya Samriddhi Yojana calculators, which provide a projection of maturity amounts based on different investment scenarios.

Sukanya Samriddhi Yojana Eligibility Criteria

• Age of the Girl Child: The girl child should be under the age of 10 years at the time of account opening.
• Account Holders: The account can only be opened by a parent or legal guardian on behalf of the girl child.
• Number of Accounts: Only one account can be opened for each girl child, with a maximum of two accounts per family. However, an exception can be made in the case of twins or triplets.

Tax Benefits of Sukanya Samriddhi Yojana

• Contributions to SSY are eligible for a tax deduction under Section 80C of the Income Tax Act (up to Rs 1.5 lakh per year).
• Interest earned on SSY is completely tax-free throughout the investment tenure.
• The maturity amount is also exempt from tax under Section 10(11A) of the Income Tax Act.

How to Open a Sukanya Samriddhi Account

1. Choose the Institution: SSY accounts can be opened at designated post offices or banks.
2. Visit the Branch: You must visit the branch with the necessary documents.
3. Fill out the Form: Complete the account opening form with the required details.
4. Deposit Initial Amount: The minimum deposit to open the account is INR 250, and the maximum deposit per year is INR 1.5 lakh.

Documents Required for a Sukanya Samriddhi Account

• Birth certificate of the girl child.
• Identity proof (Aadhaar, PAN, or passport) of the parent or guardian.
• Address proof (Aadhaar, passport, utility bills).
• Passport-size photographs.

*Additional documents may be required by the bank/post office.

How to Pay for Sukanya Samriddhi Yojana Online

Many banks and post offices now offer online payment facilities for SSY. You can:

1. Log into your bank’s or post office’s online portal.
2. Choose SSY as the payment option.
3. Select the amount and make the payment using net banking, UPI, or debit/credit cards.

Withdrawal Rules for Sukanya Samriddhi Yojana

• Partial Withdrawal: After the girl child turns 18 (or has completed Class 10), up to 50% of the account balance can be withdrawn for education purposes, provided she submits proof of admission.
• Full Withdrawal: The account matures after 21 years from the date of opening, and the entire balance, including interest, can be withdrawn. If the girl gets married after turning 18, the account can be closed early by submitting valid proof.

Rules for Premature Withdrawal from SSY

In the unfortunate event of the account holder's death, the account can be closed upon submitting an application along with a death certificate from the competent authority. The remaining balance and accrued interest up to the date of death will be paid to the guardian.

Additionally, on extreme compassionate grounds, such as the account holder facing life-threatening medical conditions or the death of the guardian, the accounts office may permit premature closure after verifying the necessary documents. However, premature closure is not allowed within the first five years of opening the account.

How to Transfer a Sukanya Samriddhi Yojana Account from a Post Office to a Bank

To transfer the SSY account from a post office to a bank:

1. Visit the post office and request an account transfer.
2. Submit the required documents and fill out the transfer form.
3. The post office will process the necessary documents, which you will submit to the bank for processing.

Conclusion

The Sukanya Samriddhi Yojana (SSY) is a secure and tax-efficient investment for parents or guardians of a girl child, offering high interest rates, tax benefits, and government backing. It encourages disciplined savings to support the girl’s education and marriage expenses.

While partial withdrawals are allowed for higher education, keeping the account active until maturity ensures maximum benefits.
If you need additional financial support for your daughter's studies, SMFG India Credit offers personal loans of up to INR 30 lakhs* to cover substantial education costs without disrupting your investments. Apply online today for competitive interest rates starting from 13% per annum*.