Sukanya Samriddhi Yojana Interest Rates

Launched as a scheme under the ‘Beti Bachao, Beti Padhao’ initiative, Sukanya Samriddhi Yojana is designed to offer a girl child financial security for her higher education and marriage. It is essentially a small deposit scheme where you can make a deposit of up to INR 1,50,000 per year.

Opening an account under this yojana offers several advantages such as attractive interest rates, potential savings on income tax, a specified lock-in period, and more. Upon maturity, the account balance along with the accrued interest is paid to the policyholder. Furthermore, even after the scheme reaches maturity, the policyholder continues to earn interest.

In the upcoming sections of this article, we will delve into the features and benefits as well as the interest rates of Sukanya Samriddhi Yojana.

Features and Benefits of Sukanya Samriddhi Yojana

Listed below are the key features and benefits of the Sukanya Samridhhi Yojana -

• The scheme can be opened by the parents of a girl child after her birth and before she turns 10 years of age.
• A minimum deposit of Rs.250 is required to open a Sukanya Samriddhi Yojana account.
• Every year, a minimum of Rs.250 should be deposited to keep the account active.
• The maximum deposit allowed under the scheme is Rs.1.5 lakhs.
• The account matures till the age the girl child attains 21 years of age or till she gets married (after the age of 18).
• Partly withdrawals are allowed from the Sukanya Samriddhi Yojana account provided the girl child has turned 18.
• Up to 50% of the balance in the Sukanya Samriddhi Yojana account can be withdrawn.
• Only one Sukanya Samriddhi Yojana account can be opened in the name of a girl child.
• Deposits can be done for up to 15 years after the account is opened and the tenure of the scheme is 21 years.

Sukanya Samriddhi Yojana Interest Rates

The Government determines the fixed interest rate of the Sukanya Samriddhi Yojana based on the yields offered by Government securities. Additionally, the interest rate undergoes a quarterly review. Once the interest rate for the Sukanya Samriddhi Account is set, it remains unchanged.

As of 2023, the Sukanya Samriddhi Yojana offers an interest rate of 8% per annum.

The interest rates for the Sukanya Samriddhi Yojana in each quarter are as follows -

How to Calculate Sukanya Samriddhi Yojana Interest?

The interest on the Sukanya Samriddhi Yojana account is computed based on the minimum balance during the calendar month, specifically between the fifth day and the last day of the month. The interest amount will be credited only once at the conclusion of each financial year.

The interest on a Sukanya Samriddhi Yojana account accumulates annually, making it challenging to manually compute the interest. However, there is a simpler solution - the Sukanya Samriddhi Yojana Calculator.

By entering essential details such as the yearly investment amount, the age of the girl child, and the year in which the account was opened, you can effortlessly determine the maturity amount with the help of the online calculator.

Who is Eligible for Sukanya Samriddhi Yojana?

Here are the eligibility criteria for the Sukanya Samriddhi Yojana -

• The account can only be opened by the girl child’s legal guardians or parents.
• The girl child should be residing in India and should be below the age of 18 years when the account is being opened.
• Only one account can be opened per girl child. 
• The Sukanya Samriddhi Account allows for the opening of multiple accounts in specific situations -

1. In case twin or triplet girls are born or if triplets come first, you can open a third account along with the existing ones.
2. However, if a girl child is born after the birth of twin or triplet girls, you cannot open a third Sukanya Samriddhi Account.

Situations Where Sukanya Samriddhi Yojana Interest Rate is Not Payable

While the Sukanya Samriddhi Yojana Account interest rates are determined by the Government, there are certain situations where interest may not accrue to the account. These situations are as follows:

• To keep the account active, an annual minimum deposit of INR 250 must be made. In case you fail to make the minimum deposit, the account will become inactive. To reactivate the account, a penalty fee of INR 50, along with the required deposit amount, must be paid. If the penalty fee is not paid, interest will not be applicable to the deposit.

In such cases, the entire deposit amount will earn a reduced interest rate. The Sukanya Samriddhi Yojana interest rate will not be applicable; instead, the lower interest rate of the savings account will apply. If any additional interest has been paid prior to the default, it will be deducted from the account balance.

• Premature closure of the Sukanya Samriddhi Yojana account is possible after 5 years from the date of opening but only for compassionate reasons such as medical emergencies or life-threatening conditions.

If the account is closed prematurely for any other reason, the Sukanya Samriddhi Yojana interest rate will not apply. In such cases, the interest rate of the savings account will apply to the deposits.

Know the Tax Implication on Sukanya Samriddhi Yojana Interest Rate

The Sukanya Samriddhi scheme is also an excellent investment scheme in terms of tax savings. The amount invested in the Sukanya Samriddhi Yojana account is eligible for deduction from your taxable income. You can claim a deduction of up to INR 1,50,000 under Section 80C of the Income Tax Act of 1961.

Additionally, the scheme follows the EEE (Exempt-Exempt-Exempt) framework. This means that not only are the investments deductible, but the interest earned and the amount received are also tax-free.

With the interest income from SSY exempted from taxes, this scheme is quite tax-efficient and allows you to save on tax liability while building a tax-free corpus for your daughter's future.

Although the Sukanya Samriddhi Yojana interest rate has been reduced in recent quarters, it still offers the highest interest rate among other small saving schemes in the market. This, combined with the tax benefits, enables you to build a substantial corpus for your daughter's future without concerns about tax obligations.

For more information regarding Sukanya Samridhhi Yojana interest rates, go through the following frequently asked questions section. 

FAQ's