The Sukanya Samriddhi scheme is a beneficial scheme introduced by the Government of India to provide for a girl child. This scheme has been started with the objective of providing a corpus fund for the girl child to use once she becomes a major. The Sukanya Samriddhi account is a scheme to financially secure the future of a girl child.
Opening this account is extremely simple. It can be opened in a bank or the post office after submitting the required documents. There are several advantages of investing in this account.
Here are advantages of Sukanya Samriddhi Account:
- Tax benefits:
The Sukanya Samriddhi Account is comparable to a PPF in terms of the tax benefits. The contribution made to this account gets a deduction under Section 80C of the Income Tax Act. Any interest earned on this is tax free. The withdrawals from this account are also tax free. It provides an excellent form of savings and corpus building.
- Small savings:
The minimum initial contribution for a Sukanya Samriddhi Account is Rs. 1,000 whereas the future contributions are Rs. 500. This makes it an attractive scheme even for small savers since the amount that needs to be deposited is not very high. There are no rules about particular instalments that need to be made. The maximum number of instalments are 12, but if the depositor deposits funds only once a year or twice a year, the account will still be active. The maximum amount that can be deposited in this scheme is Rs. 1,50,000.
- Contribution vs Maturity:
Contributions have to be made for 14 years from the date of opening. However, the account will mature after 21 years from the time of opening. For the remaining tenure, the account continues to earn interest on it. This provides the beneficiary a chance to earn higher interest.
- For all girl children:
It is possible to open a Sukanya Samriddi account for both a biological girl child and an adopted girl child. The scheme does not distinguish between a girl child. It also allows account opening for two girl children. In case the parents have a multiple birth the second time, then this account can be opened for all three girl children.
- High interest rate:
The current rate of interest on a Sukanya Samriddhi Account is the highest rate of interest for any small savings scheme. The rate of interest is revised by the Government every quarter. The current rate of interest is 8.1%
The scheme allows a girl child to operate her own account after she reaches 10 years of age. The account can be operated anywhere in India. The funds can be withdrawn for a girl child’s education or marriage and the account can still be continued.
- Interest payment:
It is not necessary to close this account once the Sukanya Samriddhi account matures. The account can still be kept live and in such a case, it will continue to earn interest.