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Sukanya Samriddhi Yojana (SSY) Scheme

Sukanya Samriddhi Yojana is a government-backed savings scheme introduced by the Government of India as a part of its "Beti Bachao, Beti Padao" campaign. This scheme aims to promote the welfare and prosperity of girl children and provide them with financial security in the long term. It offers a reliable investment option for parents or guardians to save for their daughter's education, marriage, or any other future expenses.

The Sukanya Samriddhi Yojana account can be opened in any authorized bank or post office across India. It is available exclusively for female children below the age of 10 years. This scheme provides attractive interest rates and tax benefits, making it a lucrative option for those looking to secure their daughter's financial future.

 

Objectives and Purpose of the Scheme

The primary objective of Sukanya Samriddhi Yojana is to empower and uplift the status of the girl child in society. Through this scheme, the government aims to foster a culture of saving for the girl child's future and encourage parents to invest in their education and overall development. It also aims to address gender inequality by providing financial support specifically tailored for the benefit of girl children.

Additionally, Sukanya Samriddhi Yojana aims to alleviate the financial burden that parents often face when it comes to providing for the education and marriage of their daughters. By promoting long-term savings, the scheme ensures that parents have a dedicated corpus to support their daughters' aspirations and dreams.

 

Eligibility Criteria for Opening an Account

To open a Sukanya Samriddhi Yojana account for a girl child, certain eligibility criteria must be met. These criteria are designed to ensure that the scheme benefits those who truly need it. Here are the key requirements for opening an account:

  1. Age of the Girl Child: The girl child should be below the age of 10 years at the time of opening the account. It is important to note that the account cannot be opened if the girl child is already 10 years or above.
  2. Parent or Guardian: The account can only be opened by the parent or legal guardian of the girl child. It provides an opportunity for parents to actively participate in securing a better future for their daughters.
  3. Citizenship: The Sukanya Samriddhi Yojana is available only to Indian citizens. Non-resident Indians (NRIs) are not eligible to open an account under this scheme.
  4. Number of Accounts: Only one account is allowed per girl child. In case of multiple girl children in a family, separate accounts need to be opened for each of them.
  5. Account Duration: The account will mature after completion of 21 years from the date of opening, or on the marriage of the account holder after she turns 18 years old, whichever comes earlier.

By satisfying these eligibility criteria, parents or guardians can take advantage of the benefits offered by Sukanya Samriddhi Yojana and secure the financial future of their beloved daughters.

 

Documents to open Sukanya Samriddhi Yojana account

When you decide to open a Sukanya Samriddhi Yojana account, it's essential to gather all the necessary documents beforehand to ensure a smooth and hassle-free process. Here are the key documents you need to have:

  1. SSY Account opening form
  2. Beneficiary’s birth certificate
  3. Address proof of the guardian or parents of the beneficiary
  4. Id proof of the guardian or parents of the beneficiary.

How can you open a Sukanya Samriddhi account?

You can open a Sukanya Samriddhi account via an authorised bank branch or a post office. However, you must know that at present, authorised bank branches or post offices do not allow the opening of a Sukanya Samriddhi Yojana account online. Once you open the account after submitting all the necessary documents, you can easily set standing instructions online.

How to open a Sukanya Samriddhi account at a bank branch

In order to open an account through a bank, simply follow the following steps:

 

Step 1: Visit the nearest branch of an authorised bank. 

Step 2: Fill out the Sukanya Samriddhi account form with the required details. 

Step 3: Provide supporting documents.

  • These documents include the following:
  • Identity proof of the parent or legal guardian of the girl child
  • Proof of residence of the parent or legal guardian
  • Photograph of the parent/legal guardian
  • Birth certificate of the child

Step 4: Now, you must pay the first deposit, which can range from Rs.250 to Rs.1.50 lakhs. This payment can be made by way of cash, demand draft, or cheque. 

Step 5: The bank shall now process your application and payment.

Your SSY account will be opened as soon as the application is successfully processed. Furthermore, a passbook is issued, thereby marking the initiation of your Sukanya Samriddhi account.

 

How to open a Sukanya Samriddhi account at a post office

You can also take the other route and open a Sukanya Samriddhi account via a post office. Just follow these steps:

Step 1: Visit your nearest post office branch.

Step 2: Fill up the post office account opening form. This is an exhaustive form, so allow us to elaborate on it:

  • Begin filling up this form by entering the post office branch name. 
  • Mention the corresponding account number if you already have a savings account with this post office.
  • Name the post office branch as well as postal address details under the option ‘To The Postmaster.’
  • On the right, paste the applicant’s photograph.
  • Now, you will find an option named ‘I/We.’ Here, enter the name of the applicant and mention ‘Sukanya Samriddhi Yojana’ in the following space.
  • You need to skip the content box as it is only applicable for opening a PO savings account.
  • Tick the type of account under the section ‘Account Holder Type.’ In case of queries or doubts, feel free to seek help from personnel at the post office.
  • You are now required to mention the amount you will deposit into this account once it is active. Remember to write this amount in words as well as figures.
  • Now, select a mode of payment: cash, demand draft, or cheque. For a demand draft or cheque, you must write the date and number mentioned on it.
  • At this point, you must enter some details, such as the applicant’s name, gender, address, Aadhaar number, and PAN, among others, in the table.
  • In order to authorise the information furnished so far, the applicant is required to sign at the end of Page 1.
  • Turn to Page 2 Section (5) if you wish to set standing instructions to pay for your Sukanya Samriddhi Yojana account. Here, you are required to check the square box adjacent to SSA stating that no other accounts are opened under the name of this depositor.
  • Now, provide nomination details, mention the date, place, and sign at the end of this section.
  • In the case of the applicant being illiterate, you must get the signatures of 2 witnesses.
  • Attach supporting documents and proofs with this Sukanya Samriddhi account form. 
  • Pay the initial deposit in cash or via a cheque or demand draft.

 

The post office will assess the application and issue a passbook when the account is opened.

Whether you open the account in a post office or a bank branch, the benefits and features of Sukanya Samriddhi Yojana will remain the same. It is important to find out which method is best 

for you

 

Where can you open a Sukanya Samriddhi account?

Opening an account at a post office or an authorized bank branch is one of the ways you can do it. Unfortunately, there is no provision for opening a Sukanya Samriddhi account online if you are asking yourself how to open a Sukanya Samriddhi account online.

But which bank should you choose when opening a Sukanya Samriddhi Yojana account?

The Reserve Bank of India authorises several banks to open a Sukanya Samriddhi account and you can take a pick from the following:

  • Axis Bank Sukanya Samriddhi Yojana
  • Allahabad Bank Sukanya Samriddhi Yojana
  • State Bank of India Sukanya Samriddhi Yojana
  • Andhra Bank Sukanya Samriddhi Yojana
  • Bank of India Sukanya Samriddhi Yojana
  • Union Bank of India Sukanya Samriddhi Yojana
  • Punjab National Bank Sukanya Samriddhi Yojana
  • IDBI Bank Sukanya Samriddhi Yojana
  • ICICI Bank Sukanya Samriddhi Yojana
  • Syndicate Bank Sukanya Samriddhi Yojana
  • Bank of Baroda Sukanya Samriddhi Yojana
  • Vijaya Bank Sukanya Samriddhi Yojana
  • Indian Overseas Bank Sukanya Samriddhi Yojana
  • Punjab & Sind Bank Sukanya Samriddhi Yojana
  • Oriental Bank of Commerce Sukanya Samriddhi Yojana
  • Corporation Bank Sukanya Samriddhi Yojana
  • Canara Bank Sukanya Samriddhi Yojana
  • United Bank of India Sukanya Samriddhi Yojana
  • State Bank of Mysore Sukanya Samriddhi Yojana
  • Bank of Maharashtra Sukanya Samriddhi Yojana
  • Indian Bank Sukanya Samriddhi Yojana
  • UCO Bank Sukanya Samriddhi Yojana
  • State Bank of Travancore Sukanya Samriddhi Yojana
  • State Bank of Bikaner & Jaipur Sukanya Samriddhi Yojana
  • Dena Bank Sukanya Samriddhi Yojana
  • State Bank of Hyderabad Sukanya Samriddhi Yojana
  • Central Bank of India Sukanya Samriddhi Yojana
  • State Bank of Patiala Sukanya Samriddhi Yojana

 

Contributions and Deposits

1. Minimum and Maximum Deposit Limit of Sukanya Samriddhi Account

The Sukanya Samriddhi Yojana is a government-backed savings scheme in India aimed at empowering young girls and securing their future. One of the most important aspects of this scheme is the deposit limit, which determines how much one can contribute towards their child's account. Let's delve into the details of the minimum and maximum deposit limits of the Sukanya Samriddhi Account.

The minimum deposit limit for opening a Sukanya Samriddhi Account is INR 250 per year. This ensures that even those with modest incomes can participate in the scheme and secure their daughter's future. The account can be opened anytime from the birth of the girl child until she attains the age of ten. It's important to note that the initial deposit must not be less than INR 250.

On the other hand, there is no upper limit for the maximum amount that can be deposited in a Sukanya Samriddhi Account. This flexibility allows individuals to invest as per their financial capability and goals. However, it is crucial to remember that the total deposits in a financial year should not exceed INR 1.5 lakh to avail of the tax benefits associated with this scheme. This upper limit ensures that individuals do not misuse the scheme for tax evasion purposes and also promotes fair participation among all income groups.

To summarize, the Sukanya Samriddhi Account provides the flexibility of opening an account with a minimum deposit of INR 250 and enables individuals to contribute any amount within the upper limit of INR 1.5 lakh per financial year.

 

2. Rules regarding regular deposits of Sukanya Samriddhi Yojana

Regular deposits are a fundamental aspect of the Sukanya Samriddhi Yojana as they not only help in accumulating a significant corpus but also ensure steady growth. Let's dive into the rules regarding regular deposits in a Sukanya Samriddhi Account to gain a deeper understanding.

According to the guidelines, a minimum deposit of INR 250 per year is mandatory to keep the account active. However, depositing the bare minimum may not yield substantial returns in the long run. It is advisable to contribute a higher amount regularly to maximize the benefits of this scheme.

Parents or guardians of the girl child can make deposits in her Sukanya Samriddhi Account until she attains the age of fifteen. These deposits can be made in the form of cash, check, or demand draft at any authorized bank or post office. Additionally, online payment facilities are also available to make the contribution process more convenient.

While there is no specific requirement for the frequency of deposits, it is recommended to contribute at least once every year to ensure the account remains active and continues to grow. Regularity in deposits demonstrates a commitment towards securing the girl child's future and helps inculcate a habit of saving from a young age.

It is important to note that once the girl child turns eighteen, no further deposits can be made in her account. However, the account will continue to earn interest until its maturity, which is twenty-one years from the date of opening or until the marriage of the girl child, whichever is earlier.

 

3. Penalty for non-compliance or irregular deposits of Sukanya Samriddhi Yojana

The Sukanya Samriddhi Yojana encourages regular deposits to ensure the girl child's financial well-being. Non-compliance or irregular deposits may result in penalties or restrictions Let's explore the penalties associated with non-compliance or irregular deposits in a Sukanya Samriddhi Account.

If the minimum deposit of INR 250 per year is not maintained, the account may be considered "deactivated." To reactivate the account, a penalty of INR 50 needs to be paid for each year of default along with the minimum deposit amount for those respective years.

It's crucial to remember that irregular deposits or failure to make the minimum deposit for multiple years can lead to the account being closed permanently. In such cases, it is important to consult with the respective bank or post office where the account was opened to understand the process of reopening or salvaging the situation.

 

Conditions for partial withdrawal of Sukanya Samriddhi Yojana

The Sukanya Samriddhi Yojana is a government-backed savings scheme in India that aims to promote financial security for the girl child. While the scheme encourages long-term savings, it also provides provisions for partial withdrawal under certain circumstances. Let's take a closer look at the conditions for partial withdrawal from a Sukanya Samriddhi account.

Financial emergency

Life is unpredictable, and financial emergencies can arise when we least expect them. The Sukanya Samriddhi Yojana recognizes this and allows partial withdrawals in such situations. To be eligible for a partial withdrawal, you must have completed at least five years from the date of opening the account, and the girl child must be at least 18 years old.

Higher education expenses

Education is the key to a bright future, and the Sukanya Samriddhi Yojana ensures that the girl child's educational aspirations are supported. In case the account holder intends to pursue higher education, a partial withdrawal can be made. However, this withdrawal is subject to certain conditions. The girl child must have attained the age of 18 years, and the withdrawal is limited to 50% of the balance at the end of the preceding financial year.

Marriage expenses

Marriage is a significant milestone in a person's life, and the Sukanya Samriddhi Yojana recognizes the financial investment it entails. To support the girl child's wedding expenses, partial withdrawal is allowed. Similar to higher education withdrawals, the girl child must be at least 18 years old, and the withdrawal is limited to 50% of the balance at the end of the preceding financial year.

 

Process to withdraw funds from Sukanya Samriddhi account

Now that we understand the conditions for partial withdrawal from a Sukanya Samriddhi Yojana account, let's delve into the process of withdrawing funds.

  1. Step one: Gather the required documents
    • Proof of identity (for the guardian)
    • Proof of address (for the guardian)
    • Birth certificate of the girl child
    • Sukanya Samriddhi account passbook
  2. Step two: Visit the post office or bank
    • Locate the post office or bank where the Sukanya Samriddhi account is held.
    • Carry all the necessary documents mentioned in step one.
  3. Step three: Fill out the withdrawal form
    • Request the withdrawal form from the concerned authority.
    • Fill in the required details such as account number, name, and reason for withdrawal.
  4. Step four: Submit the withdrawal request
    • Submit the filled withdrawal form along with the necessary documents to the authorized personnel.
  5. Step five: Verification and approval
    • The withdrawal request and documents will be verified by the concerned authority.
    • Once verified, the withdrawal request will be approved, and the funds will be disbursed accordingly.
  6. Step six: Receive the funds
    • After the approval, the funds will be transferred to the guardian's bank account or issued as a demand draft.

Remember, it is advisable to initiate the withdrawal process well in advance to allow sufficient time for processing and disbursing the funds.

Withdrawal rules on girl's marriage or higher education in Sukanya Samriddhi Yojana

The Sukanya Samriddhi Yojana aims to ensure financial support for a girl child's marriage or higher education. Let's take a closer look at the withdrawal rules specifically applicable to these significant life events.

Marriage expenses

When withdrawing funds for marriage expenses, the girl child must have attained the age of 18. The withdrawal is capped at 50% of the balance at the end of the preceding financial year. It's important to note that the withdrawal can only be made by the guardian before the marriage or by the girl child herself after attaining the age of 18.

Higher education expenses

Withdrawals for higher education purposes follow similar guidelines as marriage withdrawals. The girl child must have completed at least 18 years of age, and the withdrawal is limited to 50% of the balance at the end of the preceding financial year. The withdrawal can be made either by the guardian or the girl child herself.

 

Calculation of returns and compounding of interest

Calculating the returns in the Sukanya Samriddhi Yojana involves a simple formula. The interest accrued on the account depends on the annual deposits made and the interest rate for that particular financial year. To determine the returns, you will need to consider the following factors:

Annual Deposits

The Sukanya Samriddhi Yojana allows for a minimum annual deposit of Rs. 250 and a maximum of Rs. 1,50,000. It is crucial to regularly contribute towards the scheme to maximize the returns. The annual deposit amount should be chosen wisely, keeping in mind your financial capabilities and long-term goals for your daughter's education and marriage.

Prevailing Interest Rate

The interest rate for the Sukanya Samriddhi Yojana is set by the government and may vary from year to year. Currently, the interest rate stands at 7.6%, which is subject to change. It is advisable to stay updated with the latest interest rates to accurately calculate your returns. Higher interest rates can significantly enhance the growth of your investment over time.

Compounding of Interest

The compounding of interest is a key factor that contributes to the substantial growth of investments in the Sukanya Samriddhi Yojana. Compounding refers to the process of earning interest not only on the principal amount but also on the accumulated interest. This compounding effect allows for exponential growth of your investment, particularly when the funds are locked in for a longer duration.

Compounding Effect on Returns

The compounding effect has a remarkable impact on the returns generated in the Sukanya Samriddhi Yojana. Let's understand this concept through a hypothetical scenario:

Consider opening an account for your daughter at the age of 5 and contributing Rs. 50,000 annually until she turns 18. Assuming a constant annual interest rate of 7.6%, let's see how the compounding effect influences the returns:

  • By the time your daughter reaches 25 years of age, the total investment made would be Rs. 9,00,000 (Rs. 50,000 * 18).
  • With the compounding of interest, the maturity amount at the age of 25 would be approximately Rs. 21,45,920.
  • The compounding effect has contributed significantly to the growth of the investment, resulting in substantial returns over time.

 

Eligibility for Tax Deduction under Section 80C

Are you looking for a smart way to secure your daughter's future while enjoying tax benefits at the same time? Look no further because the Sukanya Samriddhi Yojana is here to fulfill your dreams! This government-backed savings scheme not only provides an attractive interest rate but also offers tax deductions under section 80C of the Income Tax Act. Let's delve into the eligibility criteria to understand how you can make the most of this wonderful opportunity.

Age Limit and Account Opening

The first and foremost requirement to open a Sukanya Samriddhi Yojana account is the age of the girl child. To be eligible, the girl must be 10 years old or younger at the time of account opening. This provision ensures that parents have a longer period to accumulate funds and secure their daughter's future needs.

Opening an account is a simple process. Parents or legal guardians can visit any authorized bank or post office with the necessary documents, including the birth certificate of the girl child, proof of identity and address of the parents, and a passport-sized photograph. It's essential to bring photocopies of these documents and the originals for verification purposes.

Maximum Contribution and Account Limits

The Sukanya Samriddhi Yojana encourages regular savings by allowing contributions in multiples of Rs. 100. The minimum annual deposit required is Rs. 250, ensuring that the scheme is accessible to individuals from all income groups. On the other hand, the maximum annual deposit limit is Rs. 1.5 lakh. Parents have the freedom to choose the contribution amount based on their financial capabilities.

Additionally, the account has a tenure of 21 years or until the girl child is married after attaining the age of 18 years, whichever is earlier. This extended duration provides a substantial period to accumulate funds and generate higher interest to meet the future requirements of the girl child.

Income Tax Benefits under Section 80C

One of the key advantages of the Sukanya Samriddhi Yojana is the tax benefits it offers. Deposits made in the account are eligible for tax deductions under section 80C of the Income Tax Act. This means that the amount deposited, up to a maximum of Rs. 1.5 lakh, can be deducted from the total taxable income of the parents or legal guardians.

This deduction reduces the tax liability and allows parents to save a significant amount of money. It's important to note that the tax benefits are only available up to the maximum deposit limit of Rs. 1.5 lakh. Any additional amount deposited will not be eligible for further deductions under section 80C.

Interests and Withdrawals

The Sukanya Samriddhi Yojana offers a competitive interest rate, which is subject to change as per government notifications. As of [current year], the interest rate stands at 7.6% per annum. This rate is revised by the government on a quarterly basis to align with prevailing market conditions, ensuring that the scheme remains lucrative for investors.

Withdrawals from the account are permitted once the girl child turns 18 years old. These funds can be utilized for various purposes, including higher education expenses or her wedding expenses. It's important to note that partial withdrawals of up to 50% of the balance at the end of the preceding financial year are allowed only after the girl reaches the age of 18.

Read more:Income Tax Deductions Section 80C: A Comprehensive Guide

author

The Tax Heaven

Mr.Vishwas Agarwal✍📊, a seasoned Chartered Accountant 📈💼 and the co-founder & CEO of THE TAX HEAVEN, brings 10 years of expertise in financial management and taxation. Specializing in ITR filing 📑🗃, GST returns 📈💼, and income tax advisory. He offers astute financial guidance and compliance solutions to individuals and businesses alike. Their passion for simplifying complex financial concepts into actionable insights empowers readers with valuable knowledge for informed decision-making. Through insightful blog content, he aims to demystify financial complexities, offering practical advice and tips to navigate the intricate world of finance and taxation.

Frequently Asked Questions

Minimum deposit ₹ 250/- Maximum deposit ₹ 1.5 Lakh in a financial year. Account can be opened in the name of a girl child till she attains the age of 10 years. Only one account can be opened in the name of a girl child. Account can be opened in Post offices and in authorised banks.

The Sukanya Samriddhi Account can be transferred to anywhere in India. It works both ways - you can transfer it either form a post office to a bank or from a bank to a post office. The transfer can be carried out between listed commercial banks and Indian post offices.

All the deposits you make in the SSY account for up to 14 years continue to earn interest until this maturity period of 21 years. However, once this maturity is over, the account will no longer earn interest. The deposit amount along with the accumulated interest will be kept idle with the government.

Furthermore, the financial incentives and tax benefits of the scheme have not only encouraged families to prioritize girl education, but also empowered girls by providing them with a financial safety net and higher education opportunities, sending a strong message of gender equality. Have given and emphasized on this.

The scheme specifies that an NRI can't open an account when they are in another country but they can open the account for their girl child once they are in India.

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