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Sukanya Samriddhi Yojana (SSY): All you Need to Know

Sukanya Samriddhi Yojana (SSY): All you Need to Know

Child Plans

Developed as part of the government's 'Beti Bachao, Beti Padhao' campaign, Sukanya Samriddhi Yojana or SSY is a welfare scheme designed for the girl child. Investing in this child insurance plan allows parents or legal guardians to ensure financial security for a girl child aging ten years or below. Under the Sukanya Samriddhi Yojana, an account in the name of the girl can be opened across any of the private and public sector banks for 21 years. The tenure of investment under SSY is 21 years, starting from the account's opening date.

What is Sukanya Samriddhi Yojana?

Sukanya Samriddhi Yojana is a saving scheme of Government of India aimed at betterment of girl child in the country. Sukanya Samriddhi Yojana is launched to provide a bright future for the girl child and enables parents to build a fund for the future education and marriage expenses of their girl child.

Sukanya Samriddhi Yojana, also referred to as SSY, is a deposit scheme made especially for the girl child. This scheme was introduced to ensure a financially secure future for the girl child.

This deposit scheme will help you save regularly for your little girl. Through regular deposits, you can create a sufficient corpus as the year's pass. This corpus can be used to meet your girl child’s goals such as education or marriage etc.

It is one of the multiple schemes that the Government introduced under its Beti Bachao Beti Padhao Yojana launched in the year 2015 by Prime Minister Narendra Modi. ‘Dhanlakshmi Scheme’, ‘Ladli Scheme’ were some of the other schemes launched.

If you want to open your account under Sukanya Samriddhi Yojana Scheme then you can do so by visiting either of the following.

a) Banks
b) Post offices

Sukanya Samriddhi Yojana- Interest Rates

The rate of interest that you will receive in your Sukanya Samriddhi Yojana account currently stands at 7.6% p.a. This interest rate is applicable from 1st April 2020. This is down from the earlier rate which stood at 8.4%.

However, if you have deposited between 12th December 2019 to 31st March 2020 then you will earn 8.4% p.a.

a) Interest is payable to you yearly
b) Interest is credited at the end of every financial year only
c) Interest rate is decided by the government and change every quarter
d) No interest will be provided if the girl becomes an NRI

Here is a table that shows the interest rates offered by the SSY scheme since its inception:

YEAR RATE
April 2020 – Present 7.6% p.a.
1 January 2019 – 31 March 2019 8.5% p.a.
1 October 2018 – 31 December 2018 8.5% p.a.
1 July 2018 – 30 September 2018 8.1% p.a.
1 April 2018 – 30 June 2018 8.1% p.a.
1 January 2018 – 31 March 2018 8.1% p.a.
1 July 2017 – 31 December 2017 8.3% p.a.
1 October 2016 – 31 December 2016 8.5% p.a.
1 July 2016 – 30 September 2016 8.6% p.a.
1 April 2016 – 30 June 2016 8.6% p.a.
1 April 2015 – March 31 2016 9.2% p.a.
3 December 2014 – March 31 2015 9.1% p.a.

How to Calculate Interest on Sukanya Samriddhi Yojana Scheme?

To calculate our corpus, we need to calculate the interest that will be added. You can use the below formula to calculate your interest in Sukanya Samriddhi Yojana Scheme.

I = P(1+R/100) ^N

I = Interest
P= Principle Invested
R= Rate of return
N= Number of Years

The compound interest on the SSY account is calculated every year. If you do not want to calculate manually, you can check the Sukanya Samriddhi Yojana Calculator available online.

What is Sukanya Samriddhi Yojana Calculator?

Sukanya Samriddhi Yojana allows you to deposit regularly in the account and create a corpus that will be useful for your girl child. This investment is very safe as it is backed by the government and has a surety of returns.

Since it is safe, you can calculate an estimated amount that you can receive once the scheme matures. For this, you can use the Sukanya Samriddhi Yojana Calculator.

In the calculator, you need to enter the investment that you will make every year and the interest rate that is applicable currently.

The maturity period is pre-defined and is of 21 years.

After entering the details, you will get the required amount. For example, if you wish to deposit Rs 12,000 every year then your corpus after 15 years would be Rs 5,27,000.

How does Sukanya Samriddhi Yojana Account Work?

As parents, you can invest a minimum of Rs 1,000 and up to Rs 1.5 lakhs every year into your daughter's account under the Sukanya Samriddhi Yojana. These deposits can be made only for the first 15 years after opening the account, after which the funds in the account would grow from the accumulated compound interest. Subsequently, the accumulated amount can help your daughter support her dreams of higher education, starting a business or marriage, once she becomes a major.

Eligibility Criteria for Sukanya Samriddhi Yojana

The Government of India has made Sukanya Samriddhi Yojana accessible for everyone, and hence, you can open an account at any post office. Understand the eligibility criteria for opening Sukanya Samriddhi Yojana account:

a) Just parents or legitimate guardians of the girl child can open a Sukanya Samriddhi account.
b) The girl child ought to be under 10 years at the time of account opening. The account can be operational till the girl child is 21 years old.
c) The opening investment can begin from ₹250 and a limit of ₹1,50,000 yearly with ongoing deposits in the products of ₹100.
d) An individual girl child cannot have numerous Sukanya Samridhhi accounts.
e) Only two Sukanya Samriddhi Yojana accounts are permitted per family, i.e., one for each.

Benefits of Sukanya Samriddhi Yojana

1. High Interest

Sukanya Samriddhi Account provides a higher rate of interest than other Savings Plans that offer financial security for the girl child. Each financial year, the government declares the applicable interest rate for that year, while the interest on your investments is compounded yearly. By maturity, the assets under your Sukanya Samriddhi Yojana account will increase manifold – thanks to the power of compounding.

2. Significant Tax Savings

Your contributions towards the Sukanya Samriddhi Yojana for your daughter's future are eligible for tax deductions under Section 80C of the Income Tax Act 1961. Thus, you can claim tax deductions up to Rs 1.5 lakh invested in the scheme. Moreover, the tax-saving benefits are also available on the interest earned and the amount received upon maturity or withdrawals. The Sukanya Samriddhi Yojana is under the authority of the Department of Revenue (DOR) and is one of the more popular investment schemes that come with the exempt-exempt-exempt (EEE) status.

3. Guaranteed Maturity Benefits

Upon maturity, your account balance under the Sukanya Samriddhi Yojana, including the accumulated interest, will be paid directly to the girl child (or policyholder). Thus, the scheme essentially helps your daughter becomes financially independent and empowered once she is mature enough to make life decisions on her own. Another benefit of investing under Sukanya Samriddhi Yojana is that your accumulated savings continue to accrue compounding interest even after maturity until it is finally closed by the account holder.

Tax Benefits of Sukanya Samriddhi Yojana

If you have an account under SSY then you are eligible to avail of tax benefits on deposits. Let's take a look at the tax benefits provided by Sukanya Samriddhi Yojana.

a) Since an SSY account is a type of investment, it is eligible for deductions provided u/s 80C of the Income Tax Act. You can avail of a deduction of up to Rs 1,50,000.
b) The compound interest that is accumulated in your deposit account is also exempt from tax.
c) The withdrawals are also tax-free. Thus, once your account matures you can withdraw the amount without deduction.

Thus, all these tax benefits make Sukanya Samriddhi Yojana an E-E-E instrument. That is, Exempt-Exempt-Exempt.

Key Features of Sukanya Samriddhi Yojana (SSY)

Sukanya Samriddhi Yojana was introduced to help the parents of the girl child build a corpus for her that could help in achieving goals such as education and marriage. It has many features that you should look for before opening an account. These are:

Features Details
DEPOSIT LIMIT - Minimum Deposit: Rs 250 (Initial Deposit), Further deposits in multiples of 50
- Maximum Deposit: Rs 1,50,000
ACCOUNT HOLDER - If the girl child is below the age of 10 years, then the account will be handled by the parent/guardian of the girl.
- A Girl can take control of the a/c once she turns 18
MATURITY 21 years after opening the account. You have to deposit for at least 15 years
DOCUMENTS REQUIRED - Birth Certificate of the girl child
- Form-1
- PAN/AADHAR of the Parent/Guardian
DEPOSITS Deposits can be made through the following:
- online transfer/NEFT
- demand draft
- cash
- cheque

How to Open Sukanya Samriddhi Yojana?

You can open a Sukanya Samriddhi Account by visiting any of the following

- Banks
- Post office

Here are the steps you can follow to open your Sukanya Samriddhi Account

1. Visit your Bank or nearest post office

2. Fill the application form of Sukanya Samriddhi Yojana. This is known as FORM SSA-1. You will be provided with this form by the bank or the post office you visit.

3. You can also download the form and fill it beforehand.

4. After filling this form, you need to submit the necessary documents. These include:
a) Birth certificate of the girl child for which you want to open the account
b) Identity Proof of the parent/guardian: AADHAR card, PAN card, Voter ID, etc
c) Address Proof: License, Telephone bill, etc.

5. Pay your first deposit. You must deposit a minimum amount of Rs 250. You can deposit up to Rs 1.5 lakhs

6. After submitting all the documents, the bank will take some days to process your application.

7. After verification, your SSY account will be opened. You will be issued a passbook

How to Open Sukanya Samriddhi Yojana Account in Post Office?

You can open your SSY account in a Post Office or a bank. The following will show you how to open an account with a Post Office.

Visit your nearest Post Office (PO):

1. Fill the account opening form provided by the Post Office Savings Bank
2. Attach your ID proof, Address proof, and other related documents with the application form
3. Deposit the sum (it should be more than Rs 250)
4. Wait for the processing of the application
5. After processing your account will be opened and you will be issued the passbook

How to Submit Documents for Sukanya Samriddhi Yojana?

Before your Sukanya Samriddhi Account can be opened, you need to submit some documents to validate your identity. As of now, you cannot submit these documents online, so you have to visit your nearest bank or post office to do the same.

Here are the documents you require:

For the Girl Child

- Birth certificate
- Form SSA-1

For the Parent

- Identity Proof: PAN Card, AADHAR card
- Address Proof: Driving License, Telephone bill, electricity bill

Though only these documents are required, the relevant bank can ask you for proof of other documents as well.

How to Pay for Sukanya Samriddhi Yojana Online?

To make the payment process more convenient for you, the SSY scheme allows deposits from the online mode as well so that you do not have to visit the place. Here’s how you can deposit money online.

1. Download IPPB (Indian Posts Payments Bank) app. IPPB is a division of the Indian Post You can download from the following link

https://www.ippbonline.com/

2. First transfer the money from your current bank account to your IPPB account

3. Now locate the ‘DOP Product’ section. Click on the SSY account link

4. After this, enter the account number of your SSY account along with the customer ID of DOP

5. Select the amount you want to deposit to your SSY account and the duration

6. Wait for the confirmation from IPPB of successful transfer

7. Once you get the confirmation, your payment is successful and your payment routine set up

What Happens if you Pay Less or Excess Amount for Sukanya Samriddhi Yojana?

To know what happens if you pay more or less than the prescribed limit, first you should know about the minimum and maximum amount you can deposit in your SSY account. These are given below.

  • Minimum Deposit: Rs 250
  • Maximum Deposit: Rs 1,50,000

1. Deposit not made/Deposit below the minimum amount

If you pay below the minimum amount of Rs.250 in a financial year, then your account will have defaulted. To make your account active again you need to pay a fine of Rs.50.

2. Excess Deposit made

No interest is generated for the deposit over and above the max limit, i.e., Rs 1.5 lakh. You can withdraw the excess amount at any time.

Withdrawal Rules for Sukanya Samriddhi Yojana

Sukanya Samriddhi Yojana Account has a maturity period of 21 years from the date of opening. But you are allowed to withdraw from your funds if conditions are met. Here are some of the rules regarding when and how much can you withdraw your funds.

1. The girl child can withdraw the whole corpus created after the maturity of the account including the interest earned. This withdrawal is without any tax restriction.

2. The withdrawal will only be allowed after you fill the withdrawal form and submit all the necessary documents such as

  • Identity Proof
  • Address Proof

Withdrawal for Education

1. You can withdraw for academic purposes if your child reaches the age of 18 years or completed the 10th standard education.

For this, you need to submit the appropriate documents related to admission such as

  • Confirmed admission offers from the college/university
  • Copy of fee slip

2. The maximum amount that you can withdraw is capped at 50% of the amount available as of the previous year.

Rules for Premature Withdrawal from Sukanya Samriddhi Yojana

There can be circumstances when you cannot continue with the account and thus have to withdraw your corpus before maturity. According to the scheme you are allowed premature withdrawal. But the following conditions will apply:

1. Premature Withdrawal in Case of Marriage

You are allowed premature withdrawal when the girl attains the age of 18 and is getting married. You will need the following:

a) Apply one month before the marriage or 3 months after the marriage declaring the same
b) Proof of identity and marriage must be submitted

2. Premature Withdrawal in Other Cases

a) In case the child dies, the right of the account will be given to you and you can withdraw the balance after submitting the death certificate
b) The account will close if the girl is no longer a citizen of India. Change in status must be communicated to the bank
c) The account can be closed after 5 years if the girl child is facing difficulties for survival. These can be the death of a guardian, parent, etc. This must be approved by the bank or the post office you have an account in.

How to Transfer Sukanya Samriddhi Yojana Account?

You can transfer your Sukanya Samriddhi Yojana Account from Post Office to a Bank. This process can be performed by the guardian or the parent itself. Here’s how you transfer your account.

1. Visit the Post Office in which you have your SSY account and inform the executive about transferring your account

2. Fill the transfer application and submit the following documents

- ID proof
- Passbook
- KYC (Know Your Customer) documents

3. Move to the bank you want to open the SSY account with

4. Self-Attest the KYC documents and the form and submit it to the bank

5. You will be provided with a new passbook after the verification and processing of documents

Details of Sukanya Samriddhi Yojana Account Passbook

A passbook is issued to you after all the formalities have been taken care of and your account has been opened. The passbook is a small booklet issued by the bank or a post office that contains a record of all your transaction that you have done through your account. It contains the following details.

a) Your deposits to the account
b) withdrawals from your account
c) interest generated

Apart from this it also contains your personal information such as your name and account number and opening date.

Empower your Daughter through Sukanya Samriddhi Yojana

Sukanya Samriddhi Yojana provides one of the best investment opportunities for you to build up a sufficient corpus for your daughter when she turns 18 years old. The Sukanya Samriddhi Yojana comes with a sovereign guarantee, while its EEE status implies that it provides several benefits to both the parent and the girl children. Thus, you can invest a portion of your savings towards the Sukanya Samriddhi Yojana to earn compounding benefits on your contributions so that your daughter can financially support her dreams of higher education and marriage despite inflationary pressures.

FAQs Related to Sukanya Samriddhi Yojana

Who can open a Sukanya Samriddhi Account?

If you are a parent of a girl child or a legal guardian, then you can open Sukanya Samridhhi Account. Through this account, you can deposit a certain sum regularly and earn yearly interest on it. This will help you create a corpus that will come in handy at the time your daughter achieves the age of higher education or marriage. SSY is a scheme that was launched by the government in the year 2015.

Can NRIs avail the benefit of the Sukanya Samriddhi Scheme?

No, till now there is no provision which states that Non-Resident Indians can also avail the benefits of the Sukanya Samriddhi Scheme and open an account under this scheme.

As of now, the girl child should be an Indian citizen. If the girl child becomes an NRI later on, then the account under SSY will be closed.

What happens in case of the death of the depositor for the girl child?

A depositor is the person who puts in money in the SSY account. It is either the parent or the legal guardian of the girl child. If the depositor dies before the maturity of the term then either of the following happens.

a. The girl child receives the money that was till now deposited with interest
b. The sum continues in the account and gains interest till maturity

How many Sukanya Samriddhi Accounts can I take for a single girl child?

You can open only one account for your daughter. In one family maximum of 2 accounts can be opened. So if you have two daughters then you can open separate accounts for both of them.

Where can you open Sukanya Samriddhi Account for your daughter?

Sukanya Samriddhi Scheme is a government initiative under the Beti Bachao Beti Padhao programme, which aims to promote girl child’s education. This facility can be opted by anyone who has a girl child.

To open this account you can avail of the facility of any of the listed banks as well as post offices. You need to submit the necessary documents and make a deposit to open your account.

What is better- Sukanya Samriddhi Scheme or Recurring Deposit Scheme?

In a recurring deposit or RD, you are required to deposit a fixed amount regularly for some time. You gain interest on your invested amount.

Sukanya Samriddhi Scheme works on the same lines as an RD but it has a specific purpose to it. In an RD anyone can invest, but an SSY account is specifically for the girl child only.

Also, the rate of interest gained in the Sukanya Samridhhi Scheme is more than the interest rate of RD

What is the minimum annual deposit amount required for the Sukanya Samriddhi Account?

To keep your Sukanya Samriddhi Account running, you need to deposit a sum at least equal to the minimum limit. As of now the minimum deposit amount you have to deposit yearly is Rs 250.

That is you need to put at least Rs 250 in a year to avoid penalty. This amount has been brought down from Rs 500.

What is the duration of the Sukanya Samriddhi Yojana account?

Sukanya Samriddhi Account matures 21 years after the date of opening. Thus if you have opened the account in 2020, it will mature in the year 2041.

You have to deposit money for 15 years. Interest will keep on adding for a whole period of 21 years.

How much amount can you get in Sukanya Samriddhi Yojana scheme?

The amount that you will receive from your SSY account on maturity will depend on the deposits you make through the period. The more you invest, the better your corpus can be.

You can also withdraw a maximum of 50% of the deposit amount once the girl child attains 18 years of age for education and marriage.

How can you check Sukanya Samriddhi Yojana account balance?

After your account is opened with the bank of a post office, you are issued a passbook. A passbook contains all the transactions you have made with your account. It shows your deposits, withdrawal and interest as well.

Print your passbook regularly to get your latest balance.

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