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The Sukanya Samriddhi Yojana (SSY) is a small savings scheme declared by the Government of India, exclusively for the girl child.
According to Sukanya Samriddhi Yojana scheme, an account can be opened in the name of the girl child by her parents or legal guardian until she attains the age of ten years. The scheme is a fragment of GOI’s ‘Beti Bachao – Beti Padhao’ initiative, which is also referred to as the BBB campaign. SSY focuses on encouraging the parents or guardians of girls to build finances for the future, education and marriage expenses of their female child.
The Government of India has taken this praiseworthy initiative to change the mindset of people towards our girls. One can open an SSY account at the post office along with some designated banks. The major advantages of an SSY account include income tax benefits and a higher interest rate compared to other small savings schemes.
The natural or legal guardian can open an SSY account in the name of a girl child from any time after her birth until the time she attains the age of 10 years. Also, you are allowed to open two accounts for two girls only. There are 2 cases in which you can also open a third SSY account. One, when twin girls are born in the first birth, and secondly, when twin girls are born at the time of the second birth. An SSY account can be opened only in the name of the girl child by a depositor.
The SSY account can be easily opened in a hassle-free way through HDFC Bank. In case you do not have an HDFC account, you can open an SSY account by submitting some mandatory documents.
|Maximum number of accounts||Up to two accounts for two girl children or three accounts in case of twin girls|
|Minimum and Maximum Amount of Deposit||The minimum amount required as a deposit to open an SSY account is Rs. 250, with an annual limit of Rs. 1,50,000 in a financial year|
|Tenure of the Deposit||The account lasts till 21 years from the date of opening.|
|Interest Rate||7.6% p.a.|
|Tax Rebate||Under 80C of the IT Act, 1961.|
You can open a Sukanya Samriddhi Yojana (SSY) account with a participating bank or a Post Office branch. You need to follow the below procedure to open the account.
Sukanya Samriddhi Yojana comes under the Ministry of Women and Child Development.
Contributions made towards Sukanya Samridhhi Yojana can be considered for income tax deduction under Section 80C of the Income Tax Act, 1961.
Here is how the Post Office account opening form looks like:
In order to fill the form, you can follow these steps:
As of now, there is no way you can apply for or open a Sukanya Samriddhi Yojana account online.
You can open a Sukanya Samriddhi Yojana account either with a participating bank or a Post Office branch. The participating banks are:
You have to download the IPPB app on your smartphone to make online payments towards your SSY account. Through this app, you can set standing instructions so that a specified amount will be transferred online to your SSY account. Here is the step-by-step procedure:
Step 1: Transfer money from your bank account to the IPPB account.
Step 2: On the IPPB app, go to DOP Products and choose the Sukanya Samriddhi Yojana account.
Step 3: Enter your SSY account number and the DOP customer ID.
Step 4: Choose the amount you would like to pay and the instalment duration.
Step 5: IPPB will notify you of the success of setting up the payment routine.
Step 6: Each time the app makes the money transfer, you will be notified of the same.
Sukanya Samriddhi Yojana was launched by Prime Minister Narendra Modi on 22 January 2015 in Panipat, Haryana.
You can open an SSY account at any of the participating banks. It is more convenient for you to open the SSY account with the bank where you already hold a savings account if it is one of the participating banks. The participating banks are:
You have to walk down to the Post Office or a bank branch where you have submitted the SSY application to submit the documents and proofs. You need to submit a physical copy of the following documents:
The interest for the SSY account is calculated on the lowest balance for the calendar month, i.e. between the fifth day of the month and the end of the month. The interest will be credited once, at the end of each financial year.
Generally, you can use the below formula to calculate the interest earned on an SSY account:
A = P(1+r/n)^nt
P = Initial Deposit
r = Rate of interest
n = Number of years the interest compounds
t = Number of years
A = Amount at maturity
Since the interest accrued on an SSY account is compounded on a yearly basis, it may not be a simple task to manually calculate the interest. Instead, you can use our Sukanya Samriddhi Yojana Calculator to arrive at the maturity amount upon entering the details, such as probable investment amount per year, the age of the girl child, and the account commencement year.
You can deposit money in an SSY account either once per financial year or in smaller, regular instalments. However, you need to make a minimum payment of Rs.250 per financial year to keep the account active and running and follow this criterion for a minimum payment period of 15 years.
If you choose to make deposits in instalments, the interval between the instalments can be anything as per your convenience. There is no restriction on the number of deposits you can make in a month or in a financial year.
You must submit the duly filled withdrawal form along with the SSY account passbook to the bank or Post Office branch where the account is maintained.
In order to claim or withdraw prematurely, you need to satisfy some conditions, such as for marriage expenses or for the higher education of the girl child.
Upon maturity of the account, the amount will be paid to the girl child holding the account.
In another case, you may prematurely close the account and claim the deposit amount only after completing five years of account opening, for the following reasons:
Only one account can be opened per girl child, either in Post Office or in any bank. This account can be opened for a maximum of two girl children in a family. Only in the case of twins or triplets girls’ birth, more than two accounts can be opened in a family.
Only the girl child, in whose name the account is opened, can withdraw the money from her SSY account upon maturity. The guardian can withdraw the money if the girl child has not attained the age of 18 years.
You can invest any amount from Rs.250 up to Rs.1.5 lakh per financial year in the SSY account.
The SSY account must be opened from the time of girl childbirth but before the girl child attains the age of 10 years.
In order to transfer SSY account from Post Office (PO) to a bank, follow these instructions:
The payment period for SSY accounts is 15 years, while the maturity period of the account is a minimum of 21 years.
PPF is a government-backed retirement saving scheme whereas, SSY is a government-backed small savings scheme dedicated to girl child development. Both accounts provide tax benefits. While a PPF account can be opened by anybody, an SSY account can only be opened in the name of a girl child before she attains the age of 10 years. PPF balance can be liquidated to a certain extent, while the same may not be true for the SSY account.
Both schemes are designed for different purposes and therefore, picking a better option between the two schemes is tough. Here is a table that gives a comparative picture of both schemes.
|Parameters||Public Provident Fund (PPF)||Sukanya Samriddhi Yojana (SSY)|
|Minimum Deposit per Financial Year||Rs.500||Rs.250|
|Maximum Deposit per Financial Year||Rs.1.5 lakh||Rs.1.5 lakh|
|Eligibility Criteria||Any single adult who is a resident Indian||Girl child below the age of 10 years|
|Maturity Period||15 years||21 years|
|Payment Period||15 years||15 years|
|Interest Rate||7.1% p.a. (Q2 of FY 2021-22); Compounded yearly||7.6% p.a. (Q2 of FY 2021-22); Compounded yearly|
|Tax Benefits||EEE benefit||EEE benefit|
|Premature Withdrawal||Upon completing five financial years||Upon the girl child attaining 18 years|
The maturity amount of an SSY account depends on the contributions you make every year. Further, you can prematurely withdraw 50% of the deposit amount once the girl child attains 18 years of age either for educational purpose or for marriage expenses.
A passbook will be issued upon opening the SSY account with a bank or Post Office. You can visit the bank or PO branch where the account is held and get the updated information regarding the account balance printed on the passbook.
Not all banks allow you to access SSY account details online. Check if the bank your account is held with provides this service. If it does, request the bank executive to provide login ID and password to access your SSY account online.
The minimum amount required to open an account under SSY scheme is Rs.250.
Life Insurance Corporation (LIC) is known for providing life insurance products to its customers. One of its products, LIC Kanyadan, is comparable with the benefits offered by SSY. Both the schemes offer financial protection for girl children and look to cover education and marriage expenses for them.
One thing to note here is that an SSY account can only be accessed by the girl child once she attains 18 years of age, while LIC Kanyadan does not provide access to the girl child at all until the father’s death.
Here are a few more differences between the LIC Kanyadan scheme and SSY.
|Parameters||LIC Kanyadan Scheme||SSY|
|Account/Policy Ownership||Policy is to be purchased in the name of the father of the girl child||Account is to be opened in the name of the girl child, maintained by the guardian until she reaches 18 years of age|
|Eligible Nationality||Any father of a girl child||Resident Indians only|
|Age Eligibility||Father: 18 years to 50 years Daughter: minimum of 1 year||Before the girl child attains 10 years of age|
|Loan Facility||Can be availed after making premium payments for three consecutive years||Not available|
|Premium/Deposit Limit||No maximum limit||Minimum Rs.250 up to Rs.1.5 lakh per fiscal year|
|Maturity Amount||Minimum Rs.1 lakh with no maximum limit||Based on the deposits made|
Prime Minister Narendra Modi introduced Sukanya Samriddhi Yojana.