By Namrata Singh and Chaitali Shah

Sukanya Samriddhi Yojana (SSY) was launched by the Government as part of the BetiBachaoBetiPadhao Campaign on January 22, 2015.  The main objective of the scheme is to encourage families to invest for education of the girl child and create a corpus for their marriage expenses.

The government had launched the scheme to  provide girls their rightful position in the society and to make them financially literate and stable. Even in the 21^st Century, some parents still prefer educating their boy child over a girl child. Sukanya Samriddhi Yojana was launched to change this mindset and empower the girl child.

As of 30^th November 2021, about 2.72 crore registered subscribers  have saved INR 1.19 lakh crores through the Sukanya Samriddhi Yojana..

Sukanya Samriddhi Yojana currently offers a 7.6% interest rate. The interest rate is relatively high compared to all other secure debt products. The government reviews the rate of all small saving schemes quarterly and the rate is subject to periodic change. The account can be opened at Post Offices or authorized public / private banks. The facility to open the account online is currently not available

 Source: https://www.nsiindia.gov.in/

Eligibility

This scheme is available for investment only for the girl child till she attains the age of 10 years. Only one account per girl child is allowed.

Biological parents or legal guardians of a girl child can open the account on the child’s behalf. One parent or legal guardian can open up to two accounts for their girl children. In case of twins or triplets the parent or legal guardian can open up to three accounts.

Premature Closure of the account is allowed only in the event of death of the account holder or where the accounts office is satisfied that in case of extreme compassionate grounds such as medical support in life-threatening diseases of the account holder or death of the guardian that the operation or continuation of the account is causing undue hardship to the account holder.

The account shall mature on completion of a period of twenty-one years from the date of its opening. Closure of the account will be permitted, on an application for closure for intended marriage of the girl after attaining  eighteen years of age.

Sukanya Samriddhi Yojana can be considered by parents of a girl child who are looking for long term and secure investment options.It has the highest fixed rate of interest and is backed by the government. It is also pertinent to note that the scheme qualifies to be the only product after PPF to enjoy an EEE status. An investor enjoys deduction benefits under section 80C of the Income Tax Act , the interest income and the maturity proceeds are also tax exempt.

Parents of a girl child should understand the scheme before taking investment decisions. _______________________________________________________________________

Namrata Singh is a Certified Financial Planner with more than 13 years of experience in banking and wealth management. ([email protected])

Chaitali Shah, MCom& MA (Economics) was a Financial Economics – Faculty at Wilson College, Mumbai  ([email protected])

(Please note all views are personal)