It is a scheme which is launched as a part of BETI BACHAO, BETI PADHAO campaign and also known by girl child prosperity account. It was launched by our Hon’ble Prime Minister Narendra Modi in the year 2015. This scheme encourages parents in building a fund for the future education and marriage expenses of their female child. It’s a government of India backed savings scheme, which targets the parents of girl children by assisting them in opening bank accounts for their girl child and saving money for their future expenses. The SSY ACCOUNT can be opened at any Indian post office or branch of authorised commercial banks, anytime between the birth of a girl child and the time she attained 10 years of age, by her guardian or parent. Recently there have been some changes in the SSY ACCOUNT RULES, and a new SUKANYA SAMRIDDHI ACCOUNT SCHEME, 2019 has been introduced. Under this account, interest is provided on the deposit sum, at a higher rate. In the year 2019-20 an interest rate of 8.4% and tax benefits were provided to these accounts and for the year 2020-21 interest @7.6 have been estimated. Only one such account is allowed per child and parents can open a maximum of two accounts for each of their children (exemption allowed for twins and triplets). The account can be transferred to anywhere in India on fulfillment of the required fees and other formalities in the respective banks. Account transfer can also be done online by following the prescribed procedure for it. A minimum of ₹ 250 must be deposited in the account initially to open the account and then afterwards, any amount in multiples of ₹100 can be deposited, with a maximum limit of ₹1,50,000. If the minimum deposit of ₹250 is not made in subsequent years, annually then the account is fined for ₹50. Account attains maturity after a time period of 21 years from the date of opening it. The girl can operate her account after she attains the age of 10 years and the account allows 50% withdrawal at the age of 18 years for higher education purposes.
Deposits can be made in the account till the completion of 15 years from the date of opening up of the account. After 15 years, the account earns the only applicable rate of interest on the deposited amount. If the account is not closed then it will not earn interest at the prevailing rate. If the girl is over 18 years and married then she can seek normal closure of an account and it is allowed. During the time of launch of this scheme, only the deposits in account were eligible for tax deduction as per the Income Tax Act. But during the 2015 union budget, the tax exemption on interest in the account and on withdrawal of the fund after maturity, was also applied which made the tax benefits of this scheme similar to those of the public provident funds (ppf). All such changes were applicable from 2015 onwards and the benefits were to be reassessed annually.
As per the new SUKANYA SAMRIDDHI YOJANA ACCOUNT RULES :
- Account remains open for 21 years from date of its opening.
- Final closure of the account may be permitted before completion of 21 years only if the account holder supplies an application with necessary documents like Aadhar card, age proof to confirm applicant’s age not below 18 years, for the purpose of intending marriage or education.
- Such premature closure cannot be made before one month preceding the date of marriage or after 3 months from the date of such marriage.
- On maturity of the account, the amount deposited interest obtained in the account shall be payable to the account holder, on application for closing up the account by account holder. Also necessary documents are to be furnished as proof of identity, age, residence, citizenship etc.
- Once the account completes the age of 21 years from the date of it’s opening, no interest shall be paid in the account.
- The Maximum limit if the amount that can be deposited in SSY ACCOUNT is ₹ 1,50,000.
- The interest income generated from investing in this scheme is tax exempted, along with tax beyond the maturity amount.
It’s a long term investment scheme that can generate a high rate of income (ROI) with a minimum contribution, annually to keep the account active . Opening up a SSY ACCOUNT in one of the ways to secure your child’s future against expenses like higher education, medical expenses, marriage expenses etc. This scheme has helped a number of poor families in arranging monetary sums for the future use in the lives of their children. It’s a great initiative taken on the part of Indian government, to strengthen the present as well as the future of girls and help their families in managing economic means for their children.
“The views of the authors are personal“
References:
- https:/groww.in>calculators, SSY online calculator.
- SSY https://en.m.wikipedia.org>wiki
