Sukanya Samriddhi Yojana – All You Need to Know

Synopsis:

  • Sukanya Samriddhi Yojana (SSY) is a government savings scheme to secure the financial future of girl children.
  • The scheme offers a high interest rate and tax benefits under Section 80C of the Income Tax Act.
  • Parents or legal guardians can open an SSY account for girls under 10 years of age.
  • Deposits range from ₹250 to ₹1,50,000 annually, with a 21-year maturity period.
  • Partial withdrawals are allowed for education after the girl turns 18, ensuring financial support for her higher education.

Overview:

Imagine a moment in your life when you hold your newborn daughter for the first time. As you gaze into her eyes, a wave of dreams and hopes for her future washes over you. You think about her education, her aspirations, and all the opportunities you want her to have. However, one pressing thought is how you will finance her future needs. That’s when you hear about the Sukanya Samriddhi Yojana (SSY), a savings scheme designed by the Government of India to secure your daughter’s financial future. 

What is Sukanya Samriddhi Yojana?

Sukanya Samriddhi Yojana was launched as part of the Beti Bachao Beti Padhao Campaign on January 22, 2015 by Prime Minister Narendra Modi. The objective was to encourage families to invest in the education of girl children and save for their marriage expenses. Keeping these objectives in mind, the small deposit scheme offers an attractive 8.2% interest rate along with tax benefits. Here’s everything you need to know about this deposit scheme!

Eligibility Criteria to Deposit Money in an SSY Account

  • Parental Requirement: The girl child's parent or legal guardian can open the account. This can be done any time after the girl's birth and before she turns 10.
  • Indian Residency: The account holder should be a resident citizen of India. Non-residents are not eligible to open or maintain an SSY account.
  • Account Limits: A family can open one SSY account per girl child, with a maximum of two accounts allowed per family. A third account is permitted only if the second birth results in twin girls.
  • Deposit Authority: Only the parents or legal guardians are authorised to deposit money into the account until the girl turns 18. After reaching 18 years of age, the girl herself can operate the account.
  • Account Operation: Once the girl child turns 18, she gains the right to operate the SSY account independently.

What are the Sukanya Yojana Account details and rules?

Deposit Limits

The account can be opened with a minimum deposit of ₹250, and the maximum deposit allowed per year is ₹1,50,000.

Maturity Period

The account matures 21 years from the date of opening or upon the girl child's marriage after she reaches 18 years.

Partial Withdrawal

Once the girl turns 18, up to 50% of the balance can be withdrawn for educational expenses, provided proof of admission is shown.

Account Opening

The account can be opened at any post office or authorised commercial bank branch across India.

Yearly Deposit

Deposits must be made annually, ranging from ₹250 to ₹1,50,000, for the first 15 years from the account opening date. No deposits are needed after this period until maturity.

Interest Rate

The interest rate is 8.2%. The interest rate is subject to periodic revision.  

Default Reactivation

The account will be marked as 'Account under default' if annual deposits are missed. It can be reactivated by paying a ₹50 fine for each year of default, up to 15 years from opening.

Maturity Withdrawal

Upon maturity, the balance and accrued interest are paid to the account holder. Required documents include the SSA withdrawal application, proof of identity, residence, citizenship, and age.

Transfer Facility

The account balance can be transferred from one post office or bank branch to another within India, provided proof of residence change is submitted by the parent, guardian, or the girl child.

Premature Closure

The account can be closed prematurely under these conditions:

  • Marriage Intent: Closure is allowed between one month before to three months after the girl's marriage.
  • Status Change: Closure is permitted due to a change in citizenship or country of residence.
  • Financial Burden: After 5 years, if the account is deemed a financial burden due to medical reasons or the death of a parent/guardian, premature closure is allowed.
  • Other Reasons: The account can be closed for other reasons but will earn interest at the rate applicable to post office savings accounts.

What are the documents needed to open a Sukanya Samriddhi Yojana Account?

To open an SSY account, you will need to provide the following:

  • Filled Sukanya Samriddhi Registration Form
  • Birth certificate of the girl child
  • ID proof of the depositor
  • Residential proof of the depositor.

What are the Tax Benefits of Opening a Sukanya Samriddhi Yojana Account?

One of the major features of the Sukanya Samriddhi Yojana is the range of tax benefits it offers:

  • Tax Deduction: Deposits of up to ₹1,50,000 per year are eligible for a deduction under Section 80C of the Income Tax Act, reducing your taxable income.
  • Tax-Free Earnings: The interest earned on the account, which is compounded annually, and the maturity proceeds are entirely tax-free, ensuring maximum savings growth.

Securing your child’s future has never been easier. Open a Sukanya Samriddhi Yojana Account today!  Contact your closest HDFC Bank Branch now for more details!