Objectives of Sukanya Samriddhi Yojana Scheme

The following are the main goals of Beti Bachao Beti Padhao:

To cease the practice of sex determination and end gender discrimination against children.
To guarantee the survival and protection of females.
To encourage more females to enroll in school and other activities.

Eligibility Criteria of Sukanya Samriddhi Yojana

This scheme by the government of India has been made accessible to everyone, hence anyone can make an account at any post office.

Up to the age of 10, a female child's parent or legal guardian may create an SSY account on her behalf.
Girl parents should have citizenship in India.
A family may create up to two accounts for two girls.
If there are identical twin females, a third SSY account may be formed.

Why should one invest in Sukanya Samriddhi Yojana?

It gives a higher return compared to other normal investment schemes.
You can invest a minimum of 250 rs to a maximum of 150,000 rs in a financial year.
Triple Tax Benefit - Principal investment, interest earned as well as maturity amount is tax-free.

Key features of Sukanya Samriddhi Yojana

With respect to account operation: Until the girl is 10, the guardian or parents can manage the account. Once the daughter reaches the age of 18, she must manage the account.
With respect to the account opening: A financial year's worth of deposits into an account can be made for as little as Rs. 500 or as much as Rs. 1.5 lakh. Deposits are only accepted in multiples of 100.
With respect to the duration of the scheme: Deposits into the plan must be made over 15 years. The plan does, however, mature after 21 years.
With respect to transfer of account: Anywhere in India, an SSY account may be moved from post offices to banks and vice versa. There won't be any fees associated with the account transfer. Verification of the residency change is required, nevertheless. If no proof is presented, a Rs. 100 fee will be assessed.
With respect to the mode of deposits: You can make deposits into the account using an internet transfer, demand draft, check, or cash.

Key Scheme Information

Currently SSY offers an annual interest of 7.60%
Lock-in period: 21 years from the date of opening of account
To open the account girl age should be less than 10
From the date of opening the account, the amount should be deposited for a period of 15 years.
The facility of partial withdrawal is available after the account holder attains the age of 18.

Sukanya Samriddhi Yojana (SSY) Latest Interest Rates

Duration	Rate of interest (%)
April 2023 – June 2023	8.0
April 2020 onwards	7.6
1 January 2019 - 31 March 2019	8.5
1 October 2018 - 31 December 2018	8.5
1 July 2018 - 30 September 2018	8.1
1 April 2018 - 30 June 2018	8.1
1 January 2018 - 31 March 2018	8.1
1 July 2017 - 31 December 2017	8.3
1 October 2016 - 31 December 2016	8.5
1 July 2016 - 30 September 2016	8.6
1 April 2016 - 30 June 2016	8.6
From 1 April 2015	9.2
From 1 April 2014	9.1

Sukanya Samriddhi Yojana Withdrawal

Sukanya Samriddhi Yojana account gives the option for partial withdrawal and premature closure of the account. But there are some circumstances for both:

Partial Withdrawal : The account holder can withdraw the amount after their girl child attains the age of 18 or has passed the 10th standard. The withdrawal is only allowed of up to 50% of the balance available at the end of the preceding financial year. The withdrawal can be made via one lump sum or in a maximum of 5 installments with a cap of 1 installment per financial year subject to any applicable fees or other charges.

Premature closure : The account can be closed after 5 years from the date of opening of the account under the following conditions -

On the death of the account holder.
On compassionate grounds in situations like the death of the guardian by whom the account was operated or in case of life-threatening illness of the account holder.

Benefits of Sukanya Samriddhi Yojana

Accessible payments: An SSY account must have at least Rs. 250 in the account each fiscal year to be maintained. Since deposits may be made up to Rs. 1.5 lakh every fiscal year, it is open to persons from all socioeconomic groups. Even if you miss a payment for a year, the minimum payment of Rs. 250 will still be charged a penalty of Rs. 50, and the account will still be active.

Educational Expenditure covered: To pay for your girl child's college expenditures, you may take 50% of the account's balance as of the end of the preceding fiscal year. This is accessible by presenting admissions documentation.
Appealing interest Rates: Presently SSY is offering an interest rate of about 8.0 P.A. These accounts offer a high rate of interest in comparison to other government schemes.
Guaranteed Returns: Being a government scheme, there is a surety of returns upon maturity.
Suitable Transfers: Since SSY is a government-backed program, returns are guaranteed when invested.
Tax advantages: To stimulate SSY investment, the program gives the following tax advantages.
Section 80C Deductions: Investments made in the SSY plan may be written off under Section 80C of the Income Tax Act, subject to a maximum deduction ceiling of Rs. 1.5 lakh.
Tax released interest: Section 10 of the Income Tax Act exempts interest accruing on the SSY account, compounded yearly, from taxation.
Tax-Free Proceeds: The money received from the SSY account upon maturity or withdrawal is likewise exempt from taxes on income.

How to open Sukanya Samriddhi Yojana Account ?

Sukanya Samriddhi Yojana Account can be opened by following the below-mentioned simple and easy steps :

Fill the account opening form.
Provide the required documents for Identity proof and Address proof like birth certificate, Adhaar card, driving license, etc.
Attach the Photograph.
Pay the amount which you want to deposit into the account.
Any other documents as requested by the bank or post office.

Who can Invest in Sukanya Samriddhi SSY ?

One must fulfill the eligibility conditions of Sukanya Samriddhi Yojana. According to the rules, the following people are eligible to open a Sukanya Samriddhi account:

a) Girls should not be more than 10 years of age

b) Should be a resident citizen of India

c) The account cannot be opened for more than two girls in a single-family

Disadvantages of Sukanya Samriddhi Yojana

Every good investment comes with its share of disadvantages too. Similarly, Sukanya Samriddhi Yojana also has some negatives. Some of the drawbacks of the scheme are mentioned below:

Lock-in period: The account is only useful if one is looking to invest for the long term. It has a maturity of 21 years from the opening of the account.
Maximum 2 Accounts: One can open only 2 Sukanya Samriddhi accounts. This is a drawback in case someone has 3 daughters. However, there is an exception in the case of twins or triplets, in which case 3 accounts are permitted.
Premature Withdrawal: Withdrawal before maturity is not permitted except in the case of the death of the child.
Variable interest rates: The Government revises the interest rates payable on all the small savings schemes every quarter.

The historical interest rates of this government scheme for girls are as follows:

Time Period	Interest rate (%)
Jan to march 2023 (Q4 FY 2022-23)	7.6
Jan to march 2020 (Q4 FY 2019-20)	8.4
Oct to dec 2019 (Q3 FY 2019-20)	8.4
July to sept 2019 (Q2 FY 2019-20)	8.4
April to june 2019 (Q1 FY 2019-20)	8.5
Jan to march 2019 (Q4 FY 2018-19)	8.5
Oct to dec 2018 (Q3 FY 2018-19)	8.5
July to sept 2018 (Q2 FY 2018-19)	8.1
April to june 2018 (Q1 FY 2018-19)	8.1
Jan to march 2018 (Q4 FY 2017-18)	8.1
Oct to dec 2017 (Q3 FY 2017-18)	8.3
July to sept 2017 (Q2 FY 2017-18)	8.3
April to june 2017 (Q1 FY 2017-18)	8.4

Read More: Kisan Vikas Patra Scheme Details

What is the difference between a child Fixed Deposit and the Sukanya Samriddhi Yojana?

It is a long-term investment plan whereas fixed deposits can be used as short-term as well as long-term investment plans. Small-tenured FDs can help you secure your investment against inflation, while long-acting FDs can help you accumulate a corpus for future needs.

Difference between a Child FD and Sukanya Samriddhi Yojana

Child FD	Sukanya Samriddhi SSY
Any Indian citizen irrespective of age or gender can open FD.	Sukanya Samriddhi account can be opened only for the girl child below 10 years of age.
The online application can be made for fixed deposits.	No online method of operation/account opening is possible for the Sukanya Samriddhi account.
A person can have more than one FD account.	In the case of the Sukanya scheme, only one account can be opened for a girl child, which has two accounts per family.
A fixed deposit requires a deposit of Rs 100	Whereas the Sukanya scheme requires a minimum of Rs 250 per year.

Comparison of Bajaj Finance Child FD vs Mutual Funds Vs SSY

Benefit	Child FD	Mutual fund	Sukanya Samriddhi Yojana
High returns	Bajaj Finance offers 8.35% interest rate on child FD In addition, Bajaj Finance FD offers an additional 0.10% interest on the renewal of your FD.	Equity Mutual funds have given 12-15% returns in the long-term	Sukanya Samriddhi Yojana offers 7.60% interest rate
Tenure	1-5 year	No fixed Tenure	Age of 21 years for education and marriage
Availability	Online & Offline	Online & Offline	Post Office or Bank (only offline)
Flexibility	Withdrawal of the entire amount can be possible without lock-in in the case of Bajaj Finance FD.	Mutual Funds are highly flexible as they can be entered into and exited from at any time.	In the case of the Sukanya Samriddhi account, you can withdraw 50% of the amount deposited only after the girl child reaches the age of 18 years.
Gender / age restrictions	No	No	Only for girls under 10 years of age
Emergency fund	Can take a loan against FD	Can redeem without penalty and interest	No

Conclusion

As experts, we provide you with good options according to your needs. As an investor, it depends on your requirements which scheme is most suited for you. Investing in both SSY and mutual funds has its advantages. While SSY offers tax rebates and is supported by the government, they offer returns which are lower than the expected returns from equity mutual funds.

The advantage of the scheme is that it comes with a lock-in, which can establish the financial discipline required for your child's future. Depending on your approach to investments, you could select the SSY for a lock-in and security. If you are open to a little more risk and can invest in a disciplined method, you could invest in equity mutual funds through the SIP route.

Also Read : SBI Bank FD Interest Rates