SSY Accounts Offer 8.2% Returns, Maturity After 21 Years

Investing ₹3,000 per month in the Sukanya Samriddhi Yojana (SSY) represents a strategic approach to building a secure financial foundation for a daughter's future. This investment strategy is part of the "Beti Bachao, Beti Padhao" initiative, specifically designed to meet the expenses of a girl child's higher education and marriage. The scheme offers tax-free returns and provides a systematic way to secure funds for future educational and marriage expenses. The lowest payment is ₹ 250/- and the highest payment is ₹ 1.5 Lakh in a fiscal year, with the account maturing after 21 years from the start date.

A SSY account can be opened by a custodian in the name of a girl who has not yet reached 10 years old as of the date the account is opened. The official scheme rules allow only one guardian to open it, and only one SSY account is allowed for one girl child. However, a family can open up to two SSY accounts for two girl children. More than two accounts in a household are permitted in the event of twins and triplets after providing an affidavit and birth papers. The account is opened in the name of the girl child but operated by the guardian until the girl turns 18. The custodian must manage the SSY account until the young female attains the age of 18. After that, the account owner may regain control of the account by providing the necessary records. The account can be opened at Post Offices and at permitted lenders, with some banks supporting online account opening through net banking and mobile banking apps, while most still require a one-time branch visit for KYC.

According to the government's PIB backgrounder, the lowest payment is ₹ 250/- and the highest payment is ₹ 1.5 Lakh in a fiscal year. The account can be opened at Post Offices and at permitted lenders. Withdrawal is permitted for the purpose of the account holder's senior schooling to cover schooling costs. The account will mature after 21 years from the start date. Tax benefits include payments counting toward the rebate under Sec. 80C of the Income Tax Act, and earnings gained in the account are exempt from Income Tax under Section -10 of the Income Tax Act. As per recent reports, deposits are required only for the first 15 years from the date of account opening, after which no further deposits are accepted but the balance continues earning interest at the prevailing rate until maturity. SSY is one of the few instruments in India that is fully Exempt-Exempt-Exempt (EEE), meaning neither the annual interest nor the final maturity proceeds are taxable. This treatment is available only under the old tax regime, while the new regime under Section 115BAC does not allow Section 80C deductions, though the interest and maturity continue to be exempt under specific small-savings provisions.

As reported by the government's PIB backgrounder, the account can be terminated early in the event of the female child's marriage after she reaches the age of 18 years. The account can be moved anywhere in India from one Post office/Lender to another. SSY accounts are freely transferable between any post office and any authorised bank anywhere in India, free of charge, on proof of change of residence of the guardian or the account holder. The transfer does not reset interest accrual or the 15-year deposit window. The account can be opened until the female child reaches the age of 10 years, and only one account can be started under the name of a female child. The account owner may regain control of the account by providing the necessary records after the custodian's tenure ends. SSY accounts can be opened at any post office or authorised bank branches including SBI, HDFC, ICICI, Axis, Kotak, Bank of Baroda, PNB, and other scheduled commercial banks across India.