SUKANYA SAMRIDDHI YOJANA

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Context

• Investors in Sukanya Samriddhi Account (SSA), whose rates have not been hiked since January 2019, are unlikely to get higher returns anytime soon, a top government official has indicated.

Sukanya Samriddhi Yojana (SSY) Scheme

• Introduced in 2016, the Sukanya Samriddhi Yojana Account (SSA) is a central government scheme aimed to cater to a girl child.
• The Sukanya Samriddhi Yojana is a government savings scheme created with the intention to benefit girl child under the initiative called “Beti Bachao – Beti Padhao”.
• The parent or guardian of the girl child who is 10 years of age or younger can open an account under this scheme.
• This scheme carries a higher interest rate along with several tax benefits.

What are the eligibility criteria to open Sukanya Samriddhi Account? 

1. The account can be opened by a parent or legal guardian of the girl child.
2. The girl child must be below the age of 10 year.
3. Only one account is allowed for a girl child.
4. A family can open only 2 SSY scheme account.

Sukanya Yojana Interest Rates

The interest rate on the Sukanya Samriddhi Yojana is fixed by the government and reviewed every quarter. The Sukanya Samriddhi Yojana interest rate for 2023 is 7.6%.

SSY Interest Rate	7.60% p.a.
Investment Amount	Minimum - Rs.250; Maximum Rs.1.5 lakh p.a.
Maturity Amount	It depends on the amount invested
Maturity Period	21 years

Tax Benefits of Sukanya Samriddhi Yojana (SSY)

• The principal amount deposited, interest earned during the entire tenure and maturity benefits are tax-exempt. The principal amount is deductible under section 80C up to Rs 1.5 lakh.
• The interest that accrues against this account which gets compounded annually is also exempt from tax under Section 10 of the Income Tax Act.
• The proceeds received upon maturity/withdrawal are also exempt from income tax.

Key Pointers related to Sukanya Samriddhi Account Scheme

• The account matures after 21 years of opening the account or in the event of the marriage of the girl child after she gains the age of 18 years.
• A premature withdrawal of up to 50% of the investment is allowed after the child gains the age of 18 years even if she is not getting married. 
• Duration of investment- 21 years.
• Minimum Investment: Rs 1,000 per annum.
• Maximum Investment: Rs 1.5 lakh per annum.
• If the minimum amount of Rs 250 is not deposited in any financial year, a penalty of Rs 50/- will be charged.
• To meet the financial requirements of the account holder for the purpose of higher education and marriage, account holder can avail partial withdrawal facility after attaining 18 years of age.
• On Maturity of the account, the balance which is principal and interest earned is paid to the girl child on submitting an application along with proof of citizenship, residency and identity. 

Significance of the Scheme

• The scheme encourages parents to build a fund for the future education of their female child.

UPSC CAPF PREVIOUS YEAR QUESTION Q. Which one of the following statements about the Sukanya Samridhi Scheme is NOT correct? 1.    Only parents of girls up to the age of 10 years can open such accounts in their daughter’s name. 2.    Contributions are eligible for tax benefits under Section 80C of the Income Tax Act. 3.    Interest earned thereon is exempted up to Rs. 1500 per annum. 4.    A maximum of Rs. 1.50 lakh per annum can be invested in this account. Answer: Option 3

https://www.thehindu.com/business/ppf-sukanya-samriddhi-account-interest-rate-hike-may-remain-elusive/article66669162.ece