About SSY Scheme:
Sukanya Samriddhi Yojana is a small deposit scheme of the Government of India mean exclusively for a girl child and is launched as a part of Beti Bachao Beti Padhao Campaign. The scheme is mean to meet the education and marriage expenses of a girl child. The government has taken up various measures in terms of education and financial freedom for the girl child. SSY is one such government back scheme to help parents save for the education and marriage of the girl child from the start itself. So, SSY is a small saving scheme, which can be open in post offices and designated private and public banks in the form of a savings account in the name of the baby girl.
The interest rate is declare quarterly just like other post office schemes. The interest rate for Jan-Mar’19 (Q4, FY 2018-19) was 8.5%. It is regard as one of the most high-paying investment options in the fixed income segment.
Eligibility for this Scheme:
Here are some points that are require for eligiblity of this scheme:
- Only parents or legal guardians of the girl child can open a Sukanya Samriddhi account in the name of the girl.
- The girl child should be less than 10 years at the time of account opening. The account can be operational till the girl reaches the age of 21 years.
- The initial investment can start from Rs. 250 and a maximum of Rs. 1,50,000 annually with further deposits in the multiples of Rs. 100.
- A single girl child cannot have multiple Sukanya Samridhhi accounts.
- You can benefit from higher interest rates offered by company fixed deposit
- Only two Sukanya Samriddhi Yojana accounts are allow per family i.e., one for each girl child.
How to use SSY scheme:
If you are in satisfying eligibility conditions, then the calculator will ask you to provide the age of your daughter/s and amount that you want to invest in the scheme. The minimum amount you can invest is Rs 1,000 and maximum is Rs 1.5 lakh in a single financial year. With effect from 5 July, 2018, the government has reduced the minimum investment amount to Rs 250.
How to invest in SSY Scheme?
You can invest in this scheme through your nearby post office or designated branches of participating public and private banks. You will need to submit KYC documents like Passport, Aadhaar Card, etc. along with the required form and initial deposit by cheque/draft. This wide reach is design to help ensure success of the Beti Bachao, Beti Padhao Yojana. The Sukanya Samriddhi Yojana (SSY) Application Form for new account can be obtain by visiting a nearby post office or participating public/private sector bank. Alternately, you can also download the SSY New Account Application Form from the RBI website. The Sukanya Samriddhi Yojana (SSY) Application Form for new account can be obtain by visiting a nearby post office or participating public/private sector bank. Alternately, you can also download the SSY New Account Application Form from the RBI website.
How to download application form?
Sukanya Samriddhi Yojana Application form can be downloaded from various sources such as:
- The Reserve Bank of India Website
- The India Post Website
- Individual websites of public sector bank like SBI, PNB,BoB etc.
- The websites of participating private sector banks (e.g. ICICI Bank, Axis Bank and HDFC Bank)
While there are multiple sources for downloading the SSY application form, the fields in the form will be the same regardless of source. If you don’t get form http://www.rbidocs.rbi.org.in/c.
How to fill Application form?
The SSY Application Form requires applicants to provide some key data regarding the girl child in whose name the investment will be made under the Beti Bachao, Beti Padhao Yojana. Details of the parent/guardian who will be opening the account/making deposits on her behalf are also require. The following are the key fields that are feature in the SSY Application Form:
- Name of Girl Child (Primary Account Holder)
- Name of Parent/Guardian opening the account (Joint Holder)
- Initial deposit amount
- Cheque/DD Number and Date (used for initial deposit)
- Date of Birth of girl child
- Birth Certificate details of primary account holder (Certificate number, date of issue, etc.)
- ID Details of Parent/Guardian (Driving License, Aadhaar, etc.)
- Present and Permanent Address (as per ID document of parent/guardian)
- Details of any other KYC Documents (PAN, Voter ID card, etc.)
Once the above details have been fill out, the form needs to be signed and submitted with the account opening authority (Post office/Bank Branch) along with copies of all applicable documents.
Benefits of this Scheme:
Sukanya Samriddhi Yojana introduced as part of the Beti Bachao, Beti Padhao Yojana initiative, provides investors with a range of benefits. Some of the key benefits of this scheme for benefit of girl child are as follows:
- Provides tax deduction benefits under Section 80C up to Rs. 1.5 lakh annually
- Flexible investment option with minimum deposit of Rs. 250 in a year (max. Rs. 1.5 lakh per annum)
- Guaranteed returns instrument backed by the Government of India (sovereign guarantee)
- Higher fixed rate of return (currently 8.5% per annum for Q4 FY 2018-19) as compared to other government-backed tax saving schemes such as PPF.
- Long term investment hence provides the benefit of compounding
- Can be freely transferr from one part of the country to another (bank/post office) in case of transfer of parent/guardian operating the Sukanya Samriddhi Account.
- The interest rate offered on an SSY account is 8.1 per cent on a yearly basis.
- Minimum deposit in an SSY account is Rs 1,000
- There is no limit to the number of deposits either in a month or in a financial year.
- One can continue to deposit in the SSY account till the completion of 14 years starting from the date of opening of the account.
- The account matures after the completion of the tenure which is 21 years. The balance in the SSY, including the interest, is paid to the girl child on submitting an application and proof of identity, residence and citizenship documents.
Comparison Of SSY Scheme and normal FD Account:
Sukanya Samriddhi Scheme is a long-term investment scheme while a fixed deposit can used as a short-term as well as long-term investment scheme. FD with short tenor can help you safeguard your investment against inflation whereas FD with long tenor can help you accumulate corpus for future needs.
Let us see the key differences between an FD for a child and SSY scheme.
- Any Indian national can open an FD, irrespective of their age or gender. Sukanya Samriddhi Account can only be open for a girl child below the age of 10 years. Also, an FD can be open in the name of the parent with the child as their nominee or beneficiary.
- Fixed Deposits can applied online. No online mode of operation/account opening is possible for Sukanya Samriddhi Account.
- An individual can have more than one FD account in their name but in the case of Sukanya Yojana only one account can be opened for a girl child, with a cap of two accounts per family.
- Fixed deposits require Rs. 100 of deposit amount per month to start with whereas Sukanya Yojana requires a minimum of Rs. 250.
What are the rules of opening A/c in this Scheme?
The account can be open by the natural or legal guardian in the name of the girl from her birth till she turns 10. So, a depositor may open and operate only one account in the name of the girl child under these rules. One can’t open two accounts for one girl because the birth certificate of the girl in whose name the account is open should be submitt by the guardian at the time of the opening of the account in the post office or bank, along with other documents relating to identity and residential proof of guardian.
How much can we invest in this Scheme?
The account can be opened with an initial deposit of Rs 250and thereafter, any amount in multiple of Rs 100 can be deposited, subject to the condition that a minimum of Rs 250 will be deposited in a financial year, but the total money deposited in an account on a single occasion or on multiple occasions will not exceed Rs 1,50,000 in a financial year. Deposits in the account can be made till the completion of 15 years, from the date of the opening of the account. For a 9-year-old, deposits have to continue till the child turns 24. Between ages 24 and 30 (when the account matures), the account keeps earning interest on the balance.
Also Read: Beti Bachao Beti Padhao Scheme Benefits Form
An irregular account where the minimum amount has not been deposit may be regularised on payment of a penalty of Rs 50 per year, along with the minimum specified subscription for the year (s) of default so If the penalty is not paid, the entire deposit, including those made before the date of default, will receive interest at post office savings bank account rate, which is currently 4%. If excess interest has been paid, it will be reverse.
Calculation of SSY A/c deposits:
The benefit of any investment can only be determine based on how much the investment grows over time. The following is a sample calculation showing the high returns you can get by making contributions to the Sukanya Samriddhi Yojana.
Let’s assume the following:
- Annual investments = Rs. 1 lakh
- Investment Period = 15 years
- Total amount invested at the end of 15 years = Rs. 15 lakh
Value of Sukanya Samriddhi Investments at the end of 15 years assuming 8% per annum rate of interest = Rs. 28.32 lakh. Thus you can almost double your money by investing in this guaranteed return investment in the long term.
Q: Can I take a loan against the balance in the SSY account?
Ans: No. The facility of loan against SSY account balance is not currently available so, You can avail the option of loan against PPF instead.
Q: Is premature closure of the Sukanya Samriddhi Yojana Account allowed?
Ans: Yes. Premature closure of the Sukanya account is allow in certain cases so, this may include compassionate grounds due to terminal illness, unexpected demise of the primary account holder, etc. However, the decision to allow such closure is on a case by case basis.
Q: Can I continue investing in SSY if my daughter and I move to another country?
Ans: The SSY account will have to be close if the girl child becomes an NRI or loses her Indian citizenship.
Q: What is the penalty if I miss my SSY account minimum annual payment?
Ans: There will be a penalty of Rs.50 if minimum amount of Rs. 250 is not deposited in the account during a financial year.
Q: Is there tax on SSY account interest?
Ans: No. SSY is a completely exempt (EEE) investment hence the principal amount invested, the interest earned as well as the maturity amount are all tax exempt.