If you’re the fortunate one to be the parent (or guardian) of a girl child under 10, put the Sukanya Samriddhi Yojana at the top of your investment priority list. The government has slashed the minimum annual deposit requirement for accounts under the Sukanya Samriddhi Yojana to INR 250 from INR 1,000 earlier, a move that will enable more number of people to take advantage of the girl child savings scheme.
Sukanya Samriddhi Yojana (SSY) is a government savings scheme that is designed to create a separate corpus for the girl child. It allows the parents/guardians of the girl child to save for meeting expenses at the time of her education or marriage, officials from the Centre for Investment Education and Learning (CIEL) told The CSR Journal.
Good news for parents
The government has amended the Sukanya Samriddhi Yojana Rules, 2016, to state that the minimum initial deposit to open the account would be Rs 250. The minimum deposit that has to be made in the account annually thereafter too has been lowered to INR 250 from INR 1,000.
Union Minister Arun Jaitley in his 2018-19 Budget speech had said that Sukanya Samriddhi Account Scheme, launched in January 2015, has been a “great success”. Till November 2017, more than 1.26 crore accounts have been opened across the country in the name of girl children, securing an amount of Rs 19,183 crore, Jaitley had said.
What is the scheme about?
Under the ‘Beti Bachao Beti Padhao’ initiative, the Sukanya Samriddhi account was launched in January 2015. Under the scheme, a parent or legal guardian can open an account in the name of the girl child until she attains the age of 10 years. As per the government notification on the scheme, the account can be opened in any post office branch and designated public sector banks.
The deposits made to the account, and also the proceeds and maturity amount, would be fully exempted from tax under section 80C of the Income Tax Act. The minimum deposit that needs to be made every year is now INR 250, while the maximum is INR 1.50 lakh. There is no limit on the number of deposits either in a month or a financial year.
The interest rate on Sukanya Samriddhi Yojana is revised every quarter, just like other small savings schemes and PPF. For the July-September quarter, the rate has been fixed at 8.1%
As per the scheme, the account will be valid for 21 years from the date of opening, after which it will mature and the money will be paid to the girl child in whose name the account has been opened. Deposits can be made up to 14 years from the date of opening of the account. After this period, the account will only earn interest as per applicable rates.
Who can open SSY account?
The SSY account can be opened by the legal or natural guardian in the name of the girl child. The account can be opened only up to the age of 10 years from the date of birth of the girl child. SSY accounts can be opened at the post office or a bank that offers the facility of the scheme.
Forms and documents
A Sukanya Samriddhi account opening form must be filled by the guardian to open the account.
The following documents need to be provided:
a) Birth certificate of the child in whose name the account is being opened. Proof of guardian’s address. Proof of guardian’s identity. Contributions
b) Initial investment can be made in cash or cheque for a minimum Rs. 1,000. A minimum of Rs 1,000 and a maximum investment of Rs. 1,50,000 can be made annually in the SSY account up to the end of the 15th year of opening of the account.
Account operations
Until the age of 10 years, only the guardian is allowed to operate the account. After completion of 10 years, the girl can operate the account herself. However, deposits can be made only by the guardian.
Withdrawals
Up to 50% of the accumulated corpus can be withdrawn after the girl has completed 18 years of age to meet her education or marriage expenses. The Sukanya Samriddhi Yojana account will mature and close when the girl completes 21 years of age or till her marriage date, whichever is earlier.
