Sukanya Samriddhi Account (SSA) is officially launched by honorable Prime Minister Narendra Modi on January 22, 2015 as a part of “Beti Bachao- Beti Padhao (BBB)” Initiative. Sukanya Samriddhi Account is a special scheme for girl child. This scheme is specially design for girl’s higher education or marriage needs.
In compliance of announcement made by Finance Minister Arun Jaitley in his Budget Speech 2014-15 the Government of India has introduced a new scheme named “Sukanya Samriddhi Account” vide Notification No.GSR No.863 (E) dated 2nd December,2014. It has been decided to allow 9.1% rate of interest on investments in the scheme during the financial year 2014-15.
Sukanya Samriddhi Account is third initiative taken by Narendra Modi lead BJP government in short span of time. Prior to this two more successful initiatives “Jan dhan Yojana” and “UAN number of PF” is already executed by this government.
Let’s review Sukanya Samriddhi Account special saving scheme in detail.
Sukanya Samriddhi Account Features
Opening account
- Sukanya Samriddhi account can be opened on the name of a minor girl child by her parents till she attains 10 years of age.
- Only single account can be opened in the name of girl child after furnishing original birth certificate.
- This account can be opened at post office or at public sector banks authorized by the government of India.
Deposit Rules
- Minimum deposit amount for this account is 1000 Rs/- per year. Maximum amount deposited for this account is 1, 50,000 Rs/- in a year.
- Deposit shall be made by cheque, DD or Cash. If minimum amount of 1000 Rs/- is not deposited every year penalty of 50 Rs/- is levied.
Rate of Interest
- For the current financial year 2015-16 highest interest rate 9.2% will be applicable on Sukanya Samriddhi Account.
- Method of calculating rate of interest will be similar to PPF, it will be compounded annually.
- Every year government will announce interest rate for this scheme.
Premature Withdrawal
- Sukanya Samriddhi Account will mature after 21 years of opening account.
- Premature withdrawal of 50% is allowed for higher education or marriage purpose only when the account holder girl child attains the age of 18 years.
Term Period
- Deposit to be made in to this account till the end of 14 years from the year of opening this account.
Tax Benefit
- The amount that is deposited under Sukanay Samriddhi Account will be eligible for income tax exemption under section 80C (Up to 1.5 Lakh).
- Interest amount earned on this account and withdrawal made from this account is tax free.
- Maturity amount of SSA is also tax free.
PPF account or Sukanya Samriddhi Account (SSA)
Basic difference between PPF account and Sukanya Samriddhi Account is rate of interest. Current rate of interest payable on PPF (up to 2015) is 8.7%, while on SSA interest rate payable is 9.2%.
My Opinion on Sukanya Samriddhi Account
Intention behind Sukanya Samriddhi Account is very good, but this scheme is more or less copy of PPF scheme. With ever increasing inflation saving for child education and marriage is not child’s play. Cost of education is rising much faster than inflation. Fixed investment return option like this may not help you create big corpus.
Best way to create big corpus for child education and marriage as discussed earlier is equity-oriented investment options like mutual funds or shares. It is advisable to allocate only small portion of your saving towards debt scheme like Sukanya Samriddhi Scheme.
Hope you agree with my thoughts…
Do share your views on above….
Ranjay kumar singh
Marvelous schem game changer spread it in ground zero. Pls give me details advise how to open account in the bank.
Raviraj Parekh
Dear Ranjay,
You can approach nearest post office to open this account. You need to carry Photo ID, Address proof and Birth Certificate of girl child.
Regards
Santanu
Govt has included this also under 80C just make it popular. But this plan need some equity touch to handle future expenses like Education and Marriage. What do you think?
prashanth kumar
can i open in bank or only post office
Raviraj Parekh
Dear Prashanth,
You can open this account at Nationalize Bank or Post Office.
HItesh Rakholiya
I am living in Ahmedabad city. I heard that some of the cities are excluded for this scheme. Is it right? Can I open an account for my baby by living in Ahmedabad only?
Thanks Raviraj.
Waiting for your reply.
Raviraj Parekh
Dear Hitesh,
This account can be opened in post office.I could not find anything that some cities are excluded.
You can refer to post office site mention below.
http://www.indiapost.gov.in/SukanyaSamriddhi.aspx
Regards,
Raviraj
varun
hi, i want to know that, what would be happened if account holder child is died in this period. whom will get this deposited money and what would be the process.
Manidipa
Hi Varun,
In case of an unfortunate death of the account holder girl child, the SSA account will be closed immediately. The balance amount will be paid back to the parent or legal guardian (whoever is the depositor) along with interest accrued up to the preceding month. To avail the amount, the guardian can communicate the respective bank or post office with the proper proof of the occurrence.
mohamed ibrahim
I want to open this account for my girl baby.I want to make initial deposit of 1,00,000 Rs. I approach post office but they told minimum 1000 or yearly 12000Rs only can deposit at initial stage. Please clarify this to me.
I check Near my SBI branch ,they told don’t have this scheme in their bank.please clarify this also.
Thank you
Raviraj Parekh
Dear Mohamed,
In this account you can deposit minimum 1000 Rs/- and maximum 1.5 Lac per year.This details is available on post office website only.Please refer to following link.
http://www.indiapost.gov.in/SukanyaSamriddhi.aspx
Regards,
Raviraj
Maqsood
Awesome scheme for the future of the girl child. but faq has not been answered or highlighted :
1. What if the parent of the girl child dies and no income for investing in the scheme?
2. What if the child is dead within 14 yrs. How should the parent get back our money which we have invested? and at what interest rate will we get back?
3. Do this scheme has a nominee option?
Raviraj Parekh
1. What if the parent of the girl child dies and no income for investing in the scheme?
No information available for this.
2. What if the child is dead within 14 yrs. How should the parent get back our money which we have invested? and at what interest rate will we get back?
Account can be closed in event of child death and amount will be given back to parents. Interest rate will be 9.1%.
3. Do this scheme has a nominee option?
Yes this scheme has nominee option.
B.Naveen Kumar
This is a wonderful scheme for female child parents , Sir pl z let me know if How much we pay monthly it will be beneficial to my child means with out leaving benefit in this scheme pl z replay
Raviraj Parekh
Dear Naveen Kumar,
You can pay from 1000 Rs/- yearly to 1.5 Lac in sukaya samriddhi account.
Ajay Dharecha
I want to open my baby’s SSA . May i invest first time Rs. 1000 and after 6 month Rs. 6000.and also next year Rs. 12000. please tell me is it Possible ?….
Raviraj Parekh
Dear Ajay, Yes you can deposit different amount at different time in sukanya samriddhi account.
SHASHI
PPF is more beneficial than Sukanya Samriddhi Account :
1. PPF account can be opened and maintained online.
2. Interest rate of PPF is slightly less but it can be equal in future
3. Nomination facility is available in the name of one or more persons. The shares of nominees may also be defined by the YOU.
4.Loan facility available from 3rd financial year up to 5th financial year. The rate of interest charged on loan taken by the subscriber of a PPF account on or after 01.12.2011 shall be 2% more than the prevailing interest on PPF. However, the rate of interest of 1% more than PPF interest p.a. shall continue to be charged on the loans already taken or taken up to 30.11.2013.
5.In case death of account holder then the balance amount will be paid to his nominee or legal heir even before 15 years.
6.The account can be transferred to other branches/ other banks or Post Offices and vice versa upon request by the YOU
7.There is a lock-in period of 15 years and the money can be withdrawn in whole after its maturity period. However, pre-mature withdrawals can be made from the end of the sixth financial year from when the commenced. The maximum amount that can be withdrawn pre-maturely is equal to 50% of the amount that stood in the account at the end of 4th year preceding the year in which the amount is withdrawn or the end of the preceding year whichever is lower.
8.Interest received is tax free
and more…
Manidipa
@ Sashi, all the points you mentioned are correct only, but we should not forget about the objective behind this scheme. This is put under Beti Bachao, Beti Padhao campaign with an associated social message.
Though premature or partial withdrawal facility seems to be better in case of PPF, where you can withdraw upto 50% amount from the beginning of the 7th year. But partial withdrawal rule is actually a very strong feature of this Sukanya Samriddhi Account. You can partially withdraw only for the child’s education purpose or in extreme health conditions, which forces the depositor to save only for that particular purpose.
sagar
to get around 6 lakh in 14 years ,how much we have to deposit yearly? please clarify my doubt… I have bit of confusion.
Raviraj Parekh
Dear Sagar,
Kindly deposit 21000 Rs/- per year to get 6 lac as maturity amount after 14 years.
Nikethan Kumar
Dear Sir,
My sister DOB is 16-jan-2001 can i open her account in Sukanya Samriddhi
plz let me know.
Raviraj Parekh
Dear Nikethan,
As your Sister DOB is 16-1-2001 she is not eligible to open Sukanya samriddhi Account.
mani
Hello, the interest accrued and maturity under the scheme are not taxable – as I could see in many websites. Can you clarify. Your statement, otherwise, would mislead.
binie
Hi Ravi
I really like your articles.
Thanks for sharing ur knowledge
R SUbramanien
Hi,
Is it Possible to convert the PPT in between, either monthly or yearly.
Regards,
R Subramanien
arun kumar rout
The SSA plan i think has certain shortcomings ;1- parents are not allowed to receive the maturity money.which may creat some problems at the time of daughter’s marriage.
2- maturity of the plan is 21yrs from the date of opening the account.so if someone opens an
account for his/her daughter aged 10yrs, it will mature at 31yrs of age.can any parents wait ?
3-at the time of her marriage before maturity she can get only 50% which may not fulfil the purpose.
4-if the daughter gets the rest amount (50%) after marriage how it will be helpful to the parents who have invested for her marriage ?
Raviraj Parekh
Dear Mr.Arun,
Whatever you said is correct this are known shortcomings.
SAJI KUMAR
Dear Arun
I am also confused by this scheme, I also think that this scheme s not useful to me also because by baby is also 10 yrs, then how I get benefit of this scheme for her study and marriage. I think the government consider this problem and do necessary to clear this shortcomes. OK if for a newly born baby’s parents this scheme is best for her future. But for 5 to 10 yr baby parents ifs not much benifit
Babu K
I am in Bangalore, i opened account in bommasandra post office, but in the post office accepted only cash (cheque and DD not accepting), where i compliant this type of mater
M Mehta
Hello!
Our girl was born outside India, but she holds Indian Passport. I went to the post office to open the account and they refused by saying it is only for Indian nationals born in India! Can anyone verify if it is true?
I have searched Internet but could not find anything specific for Indian Citizen born outside India.
Thanks
Raviraj Parekh
Dear Munjal, Sukanya Samriddhi Account can be opened for girl of Indian Nationality.For NRI this account can’t be opened.
Abhishek Kumar
Can A man open Sukanya Samriddhi Account for her grand daughter
Raviraj Parekh
This account can be opened by grandfather but Authorization of Father and Mother is required.
SAJI KUMAR
Dear Sir
My Baby is 9 yrs old and I open an Account for her, but now I know that the maturity period is 21 yrs . Ok partial withdrawl of up to 50% is OK after 18 years but maturity period after 31 years of her age is of what use. Every one wants money for her kids Education and marriage and that is from 20 to 25 yrs and if t closes at 31 yrs of their age I can’t under stand this scheme is for what purpose. So please any one clear my doubts.
Raviraj Parekh
Dear Saji,
You are absolutely correct that the preliminary objective of this scheme is education and marriage of girl child.Under Sukanya Samriddhi Scheme, you can either withdraw 50% of the money or full amount and can close the account.
Kumara swami
What kind of benefit is this scheme adding by including under 80c. Govt should take some bold steps here. Also if one person has two daughters how is this benefiting the girl childs, in my opinion the scheme needs to be altered. Keeping it out of 80c will welcome more investments as well as making it separate for individual girl childs will also help both the father and the girl childs
uday
Hi,
I have opened an account for my daughter last month with a monthly installment of 12,500.
But as the interest is calculated for a financial year, can I deposit current years 1.5 lacs and last year 1,47500.
Is that feasible.
Thanks
Uday