Sukanya Samriddhi Yojana was launched in order to ensure a bright and prosperous future for the girl child. Also referred to as the girl child prosperity scheme, it is a welcome step taken in order to provide financial security to girls in India.
Sukanya Samriddhi Yojana: A Scheme for Girl Child
Sukanya Samriddhi Yojana is a special deposit scheme that was initiated under the “Beti Bachao beti padhao” i.e.”Save Girl Child, Educate Girl child” campaign.
Although, we have various long term investment options in India. But, this small saving scheme has gained popularity since the time it was launched, due to the high rate of interest it offered.
So, this scheme has been introduced basically as an investment alternative for the girl child and her financial security. It is a great step towards financial independence of the girl child.
In a country like India, where issues related to gender inequality still prevail, Sukanya Samriddhi Yojana is a massive step taken by the Government towards the betterment of the girls in India.
This Investment Scheme will help build a good corpus to meet the financial needs of the girl child at the time of pursuing higher education or meeting wedding expenses.
Sukanya Samriddhi Scheme Details: Features
1. It can be opened in the name of the girl child till she attains the age of 10 years. In simple words, you can open this account any time before a girl attains the age of 10 years.
2. Only One account for one girl child is allowed to a maximum of two accounts for two girl children.
3. The account can be opened at authorised banks and Post offices.
4. Parents or legal Guardian can open the account in the name of the girl child only. The account shall be operated on behalf of the girl by the parents/guardian till she reaches 18 years of age.
5. Rate of Interest on Sukanya Samriddhi Account was @8.6% per annum for first two quarters of the financial year 2016-17. So, interest rate on SSY for Oct’16 to Mar’17 is 8.5% p.a.(this scheme was introduced with an interest rate of 9.2% initially). The interest is not fixed and will be decided by the government every year.
Note : SSY Interest rate for Financial year 2018-19 has been revised to 8.5% compounded yearly.
6. Minimum Investment required is Rs.1000 to a maximum of Rs.150000 in a financial year.
7. You can deposit till completion of 14 years only from date of opening of account.
8. Partial withdrawal maximum upto 50% of balance at end of preceding financial year can be taken when girl attains 18 years of age.
9. The account can be closed after completion of 21 years only. If the account is not closed, the balance will continue to earn interest at the specified rates. Normal premature closure will be allowed after completion of 18 years provided the girl is married.
10. You can claim a Tax deduction U/s 80 C of The Income Tax Act, upto a maximum of Rs.1.5 lakhs for the amount contributed towards this scheme during a particular financial year.
11. The interest received and total maturity amount will both be tax free just like PPF. Getting tax free returns at maturity is the major factor attracting the investors to consider Sukanya Scheme in their long term investment plans.
12. If the account is not closed when the girl attains the age of 21 years and no money is withdrawn,the account continues to earn interest.
How to open Sukanya Samriddhi Account?
You can open a Sukanya Samriddhi Account at any post office or public sector banks or authorised private sector banks across all states of the country.
You can download the Sukanya Samriddhi Application form here:
You can also download the Sukanya Samriddhi Account opening form at the websites of the respective banks and print the same. You just need to fill the required details as per the form and submit it alongwith the relevant documents as mentioned below.
Open Sukanya Samriddhi Yojana Account: List of major Authorised Banks
- State Bank of India (SBI)
- Bank of India
- Corporation Bank
- Axis Bank
- UCO Bank
- United Bank of India
- Bank of Baroda
- Indian Bank
- IDBI Bank
- Central Bank of India
- Punjab National Bank (PNB)
- Punjab & Sind Bank (PSB)
- Bank of Maharashtra
- Andhra Bank
- Allahabad Bank
- Canara Bank
- Dena Bank
- Indian Overseas Bank
- Syndicate Bank
- Oriental Bank of Commerce
- ICICI Bank
- Vijaya Bank
Further, all Post offices have been authorised to open Sukanya Samriddhi Account for the girl child. This list has been compiled on “as is ” basis, there may be certain additions or modifications in the above Banks list. Do check with the respective banks before investing your money.
Sukanya Samriddhi Yojana Account: Documents required
- Sukanya Samriddhi Account opening form.
- Birth certificate of the girl is the main document to be submitted while opening the Sukanya Samriddhi Account.
- ID Proof of Parents/Guardian like PAN Card, AADHAR, Driving license, Passport etc.
- Address Proof of Parents/Guardian like AADHAR, Driving license, Passport etc.
When you open an account under Sukanya Samriddhi Yojana, you will be issued a Passbook that will be used for transaction recording purpose.
Taking into consideration all these features, Sukanya Samriddhi Yojana is overall a decent investment option.
This scheme suits the ones who want to invest their money for longer duration and with lesser risk and good returns.
Tax Benefits on Sukanya Samriddhi Yojana:
Suknaya Samriddhi Yojana, a small saving scheme is of EEE nature i.e.Exempt at all 3 stages just like PPF or Public Provident Fund.
EEE means following amounts are Exempt, exempt, exempt:
- Contribution or Deposit amount is Tax free U/s 80 C of The Income Tax Act upto a maximum of Rs.1.5 lakhs (as is the limit of Sukanya Samriddhi Scheme).
- Interest earned is Tax free.
- Maturity/Withdrawal amount is also Tax free.
The the tax benefits and a good rate of interest seem quite attractive. A huge number of investors planning their long term investments are inclined towards investing in Sukanya Samriddhi Scheme.
To know about PPF, a popular long term investment, you can refer: PPF Account, PPF Interest rate, PPF Rules – The Ultimate guide!
But, there are few drawbacks of this scheme as well like:
- The long lockin period will suit only those investors who wish to invest their money for a fairly long period.
- No loan facility is available against this account unlike PPF.
- Deposits can be done via cheque or cash,no online facility available yet.
- Initially the interest rate is good,but gradually it might see a declining trend in the years to come.
But still, Sukanya Samriddhi Yojana is great long term investment tool, that has been introduced for the benefit of girls in India. It is a new scheme and a lot of changes might be seen in the years to come, as this scheme becomes more and more popular amongst investors.
To conclude, if you are thinking to invest for your sweet little daughter, this might be your choice. Looking for a risk free investment, this is probably a good and safe long term investment option to secure her future in the best way.
For planning your other Long term Investments you can refer : 7 Best Long term Investments in India!
For any queries thereon, see you in the comment section below. Feel free to share your valuable feedback.