On 22nd January 2015, under the ’Beti Bachao Beti Padhao‘ campaign, Prime Minister Narendra Modi launched the Sukanya Samriddhi Yojana (SSY). This scheme is meant for the girl child and through it, parents can save a certain amount in an above-average interest generating account. You can conveniently open this account at a bank or a post office and enjoy its many benefits.

The Sukanya Samriddhi Yojana can be really helpful in securing the future of the girl child. The money saved and accumulated through the attractive interest rate of this scheme can prove extremely helpful in financing higher education and also secure your daughter‘s future. There are also possibilities for premature withdrawal of funds in case of emergency. Let‘s look a bit more closely at the Sukanya Samriddhi Yojana and understand how it works.

How Does the SSY Scheme Benefit My Girl Child?

The Sukanya Samriddhi Yojana is a savings account with a lock–in period of 21 years. This savings scheme offers an interest higher than your regular savings account and bank fixed deposits. The following are the prominent features and benefits of the scheme

1. Longer Maturity & Deposit Period

   SSY is an objective–specific scheme – the objective being saving money for the girl child‘s higher education or other expenses. Therefore, the maturity for the SSY scheme is 21 years. For instance, if you open the SSY account when your girl child is 2 years old, the deposited money will continue to mature until she reaches 23 years of age. However, the deposit period of the scheme is 14 years, i.e., in the case of a 2–year–old girl child, you can deposit money in the SSY account until she reaches 16 years of age

2. Lower Deposit Amounts

   You can open an SSY Account with amounts as low as Rs 250 per year. The maximum you can deposit is Rs 1.5 lakhs

3. Attractive Interest Rates

   As of 2022, SSY schemes offer interest rates of 7.6%. This rate is well above your average savings account or fixed deposit interest rates. The Sukanya Samriddhi Yojana interest rate is compounded annually and revised by the RBI every quarter. If you start saving Rs 50,000 every year at a 7.6% interest rate, your daughter will have Rs 21.21 lakhs accumulated

4. Tax Benefits Under Section 80C

   Under Section 80C of the Income Tax Act, 1961, you can avail up to Rs 1.5 lakhs as a tax deduction with this scheme. Both accrued interest and the maturity amount are exempted from income tax. Therefore, you can add the Sukanya Samriddhi Yojana to your list of tax-saving schemes and significantly reduce your taxable income

5. Partial Withdrawals Allowed

   The SSY scheme allows up to 50% of withdrawal when the girl child reaches 18 years of age. This amount can be used only for higher education or marriage purposes. The account will cease to exist once the girl child is 21 years old as she can then withdraw the entire amount

6. Transferability of the SSY Account

   SSY accounts are flexible when it comes to transferability. If you move to a different city, you can transfer your account to different bank accounts or post offices within India. Upon providing proof of residence, no charges will be levied for the transfer of account

Sukanya Samriddhi Yojana Eligibility

You can open up to 2 SSY accounts per family; however, exceptions apply in the case of twins and triplets, where parents can open 3 accounts. You can open a Sukanya Samriddhi Yojana if:

1. The girl child is not more than 10 years old

2. The person opening the account is a biological parent or a legal guardian of the child

Steps to Open a Sukanya Samriddi Account

Now that you know the Sukanya Samriddhi Yojana benefits and eligibility, let’s see how you can open this account. You can open an SSY account in a bank or a post office by submitting the physical application form along with your KYC documents. Here are the steps

1. Print the form from the official website of the Post Office, Reserve Bank of India, or any participating public or private sector banks.

2. Fill in the form with all relevant details.

3. Attach the following Sukanya Samriddhi Yojana documents.

   1. SSY Account Opening Form,

   2. Birth Certificate of the girl child,

   3. ID and address proof of parents or legal guardians,

   4. Medical certificates in case of twins or triplets,

   5. Other relevant documents required by the bank or the Post Office.

4. Submit the form in the bank or the post office, or upload scanned copies of the above-mentioned documents online if the provision is available

5. Deposit the preferred amount in the SSY Account

6. Now that the SSY account is active, you can keep depositing more in denominations of Rs 100 by using the internet or mobile banking services

Rules to Withdraw Sukanya Samriddhi Yojana Maturity Amount

The girl child can withdraw the maturity amount by providing proof of higher education or marriage

1. For Higher Education: After 18 years of age, the girl child can withdraw up to 50% from the SSY scheme. The condition is that the girl child completes her 10th standard education and provides documents stating admission to the university or college along with the fee receipt

2. For Marriage: The girl child must attain 18 years of age and apply 1 month prior to or 3 months post marriage.

3. Partial withdrawal, i.e., 50% of the available amount can be dispensed as a lumpsum or in 5 instalments. The account will cease to exist if the residency status of the girl child shifts to a non-resident of India or if the girl child faces unforeseen demise

Conclusion

The Sukanya Samriddhi Yojana is an excellent initiative by the Government of India towards the benefit of the girl child. Since interest rates are higher, the returns are higher. Rules governing the withdrawal of money ensures that the amount is used for the girl child only and not for the parent or the legal guardian. Indeed, the SSY scheme can help parents secure their daughter’s financial future

Disclaimer: The above information is indicative in nature. For more details on the risk factor, terms and conditions, please refer to the Sales Brochure and Policy Wordings carefully before concluding a sale