This scheme was launched on January 22, 2015, by Prime Minister Narendra Modi under the consideration of the Beti Bachao, Beti Padhao initiative. Sukanya Samriddhi Yojana (SSY) is a dedicated, government-backed long-term savings scheme designed to financially empower a girl child by accumulating funds for her education and marriage.
What is Sukanya Samriddhi Yojana (SSY)?
SSY is a post-office and bank-deposit-linked scheme where parents or the other legal guardians can open an account before the girl turns 10. Funds can be designated for her future, covering college, professional courses, or wedding expenses. The scheme matures 21 years from account opening, offering guaranteed interest and tax-free maturity.
Eligibility & Account Limits
- Who can open: Only parents or legal guardians of an Indian girl child who is under 10 years old can open an SSY account. Each girl is allowed only one SSY account, though families can have up to two accounts (one per girl). In the case of twins or triplets, a third account is permissible.
- Minimum age: The girl must be under 10 years old. For those born slightly before the SSY launch, certain age relaxations applied in the initial years.
- Opening venues: SSY accounts can be opened at any India Post office or participating public/private bank branches such as SBI, HDFC, ICICI, Axis, PNB, etc.
Deposits: How Much & For How Long
- Minimum deposit: ₹250 per year.
- Maximum deposit: ₹1.5 lakh per financial year. Deposits can be made in the range of lump sums or multiple instalments, as long as the annual sum falls within the prescribed limits.
- Duration of deposits: A mandatory deposit for the first 15 years from account opening. After that, the account can continue to earn interest until maturity at 21 years, even without further deposits.
- Penalty for default: Failure to make the minimum ₹250 deposit in a financial year marks the account as defaulted. It can be reinstated by paying the minimum deposit plus a ₹50 penalty per missed year.
Interest Rate & Calculation
- Current interest rate: 8.2% per annum (for July–September 2025), compounded annually.
- Interest calculation method: Based on the lowest balance between the 5th and the end of each month, with interest credited once per financial year.
- Formula:
A=P(1+n/r) nt
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- P = initial deposit
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- r = annual interest rate
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- n = compounding frequency (1 per annum)
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- t = number of years
A helpful online maturity calculator is available on banking or financial websites.
Withdrawal & Maturity Rules
- Final Maturity: After 21 years from account opening or upon the girl’s marriage post-18 years, whichever is earlier.
- Partial withdrawals: After the beneficiary turns 18 or completes 10th grade, the guardian can withdraw up to 50% of the account balance (as of the previous financial year-end) to fund education. Valid proof of admission is mandatory.
- Premature closure is allowed under specific conditions:
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- Marriage after 18 years (3 months post-marriage, with application submitted a month before).
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- The girl or guardian suffers a life-threatening illness, or the girl becomes a non-resident Indian, or non-citizen, or dies. Documentation is required.
- Transfer facility: SSY accounts are fully transferable anywhere in India, between post offices or banks—without charges—though proof of new address may be required.
Tax Benefits (EEE Structure)
- Exempt–Exempt–Exempt (EEE) status ensures:
- Invested amount (up to ₹1.5 lakh/year) is deductible under Section 80C.
- Interest earned is completely tax-free.
- Maturity proceeds and withdrawals are also tax-exempt.
- New tax regime: Does not allow 80C deductions, but interest earned and maturity amounts remain tax-free…!
Account Operation & Documentation
- Account operation:
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- Opened and operated by a guardian until the girl turns 18.
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- After 18, she can operate the account independently, upon submission of KYC, Aadhaar, and PAN.
- Documents needed:
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- The birth certificate of the girl
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- Aadhaar and PAN (now mandatory, with six months to submit upon opening)
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- Parent/guardian KYC: photo ID, address proof.
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- SSY forms: Form‑1 (opening), passbook, nomination, withdrawal‑for‑education (Form‑3), etc.
Strengths & Considerations
Pros:
- High government-guaranteed interest (~8.2%)
- Full tax benefits (EEE)
- Helps parents build a solid education/marriage corpus
- Suitable even with small periodic deposits
Cons:
- Long lock-in period (21 years) with only partial withdrawal options
- No loan facility
- Premature full withdrawal is only allowed under specific conditions
- Individuals living abroad or girls becoming NRIs/citizens elsewhere must close the account.
Who Should Invest?
SSY is ideal for parents or guardians who:
- Want to save tax-efficiently (up to ₹1.5 lakh under Section 80C)
- Plan long-term savings for girls’ education or marriage
- Prefer guaranteed returns over market volatility
Start early, even small annual deposits accumulate an appreciable corpus over 21 years, thanks to compounding.
How to Open & Manage the SSY Account?
- Visit the nearest post office or participating bank.
- Complete Form‑1, submit KYC & birth proof.
- Deposit at least ₹250 to activate.
- Receive a passbook for tracking deposits & interest.
- Transfers & withdrawals follow through designated forms and valid documentation.
- Stay updated on quarterly interest revisions via official sources.
Conclusion
With its targeted focus on girl children, attractive interest, full tax-exemption, and long-term financial discipline, Sukanya Samriddhi Yojana stands as one of India’s most rewarding small-savings schemes. It’s a thoughtful investment tool ensuring a secure educational and matrimonial future for girls, making it a wise choice for parents planning ahead.
NOTE: Since interest rates are subject to quarterly reviews by the government, check the latest rates on official post office or RBI websites before investing.
