Sukanya Samriddhi Yojana (SSY): Benefits, Eligibility & Interest Rates

Every parent dreams of providing their daughter with the best opportunities in life—be it quality education, skill development, or a financially secure marriage. However, with rising costs of education and inflation steadily eroding savings, planning ahead becomes essential. This is where Sukanya Samriddhi Yojana (SSY), a government-backed small savings scheme under the “Beti Bachao, Beti Padhao” initiative, plays a vital role.

Introduced in 2015, SSY has become one of the most popular saving schemes for girl children in India. Its combination of attractive interest rates, sovereign guarantee, and tax exemptions makes it a reliable choice for parents seeking long-term savings. By starting early, families can accumulate a significant corpus by the time the account matures (21 years after opening)—without worrying about market risks.

But is SSY enough on its own? Should you pair it with private savings and protection plans for better security? This guide will explore all the important aspects of SSY—eligibility, benefits, interest rates, maturity rules, tax advantages, and comparisons with other investment avenues.

Introduction: What is Sukanya Samriddhi Yojana (SSY)?

Sukanya Samriddhi Yojana (SSY) is a small savings scheme exclusively designed for the welfare of the girl child. It allows parents or legal guardians to open a dedicated account for their daughter before she turns 10 years old.

Key features include:

• Government-backed scheme with sovereign guarantee.
• Long-term savings horizon of up to 21 years from account opening.
• Flexible deposit range, starting as low as ₹250 per year.
• High SSY interest rate (currently 8.2% per annum as of Q3 FY 2025-26, subject to quarterly revisions)—one of the highest among small savings schemes.
• Tax benefits under Section 80C and tax-free interest & maturity.

In short, SSY combines safety, tax efficiency, and purpose-driven savings for parents who want to build a dedicated education and marriage fund for their daughter.

Eligibility Criteria and Account Opening Rules

To ensure that the scheme benefits its intended purpose, SSY comes with specific eligibility conditions:

• Who can open the account?
  Parents or legal guardians of a girl child can open an SSY account.
• Age of girl child:
  The account must be opened before the child turns 10 years old.
• Number of accounts allowed:
  • One account per girl child.
  • Maximum of two SSY accounts per family, except in case of twins or triplets.
• Minimum deposit: ₹250 per year.
• Maximum deposit: ₹1.5 lakh per year.

The account can be opened at post offices and authorized banks, making it widely accessible across India.

Interest Rates and Deposit Limits in SSY

The interest rate for SSY is declared by the government every quarter, similar to other small savings schemes.

• Current SSY interest rate (Q3 FY 2025–26): 8.2% p.a. (compounded annually, credited yearly).
• Deposits can be made any number of times in a financial year, subject to the annual limit.
• Deposits are allowed for 15 years from account opening, after which the corpus continues to earn interest until maturity at 21 years.

💡 Example:
If you invest ₹1.5 lakh every year for 15 years, at an average SSY interest rate of 8%, your daughter could receive ₹65–70 lakh at maturity, fully tax-free.

This makes SSY not only a disciplined savings tool but also a high-yielding, risk-free investment.

Tax Benefits and Exemptions under SSY

SSY enjoys “Exempt-Exempt-Exempt (EEE)” tax status, meaning:

1. Investments qualify for deduction under Section 80C (up to ₹1.5 lakh).
2. Interest earned is tax-free.
3. Maturity proceeds are also fully exempt from tax.

This triple tax benefit makes SSY one of the best saving schemes for girl children in terms of long-term wealth creation and tax efficiency.

👉 Parents looking for additional tax-saving options can also explore other Best Investments That Save You Tax Under 80C.

Maturity Rules and Partial Withdrawal Options

The SSY account matures 21 years from the date of opening or upon the marriage of the girl after 18 years, whichever comes first.

• Partial withdrawal: Up to 50% of the balance can be withdrawn after the girl turns 18 years, specifically for higher education expenses (e.g., tuition or related costs).
• Premature closure: Allowed in cases of marriage (after 18), death of account holder, or extreme compassionate grounds.
• Continued deposits: Allowed for 15 years (with a minimum of ₹250 annually to avoid default), but the account continues to earn interest till maturity even without fresh deposits.

This ensures parents have the flexibility to use funds when major life events like higher education or marriage arise.

Advantages of SSY for Long-Term Child Savings

SSY offers several strong advantages:

• High, risk-free returns backed by government guarantee.
• Disciplined savings habit with a long lock-in period.
• Targeted savings for the girl child’s education and marriage.
• Complete tax exemption on investment, interest, and maturity.
• Low entry barrier (₹250 minimum annual deposit).

For parents who want security and stability, SSY stands out as one of the most reliable long-term child investment options in India.

Limitations and Risks of Relying Solely on SSY

Despite its benefits, SSY has limitations that parents should consider:

• Restricted usage: Funds can only be used for the daughter’s education or marriage.
• Limited liquidity: Lock-in till 18 years for partial withdrawal, 21 years for full maturity.
• Fixed deposit ceiling: Cannot invest more than ₹1.5 lakh per year.
• Inflation risk: While interest rates are attractive, rising education and healthcare costs may outpace SSY returns in the long term.

Hence, while SSY is excellent for guaranteed savings, parents may need to combine it with insurance, mutual funds, or child investment plans for comprehensive financial planning.

Alternative Savings Options for Children’s Future

Parents should diversify savings to balance growth and safety. Some options include:

1. Public Provident Fund (PPF) – Long-term, tax-saving, safe instrument.
2. National Savings Certificate (NSC) – Fixed return with 5-year lock-in.
3. Child-focused investment plans – Designed for education/marriage needs, with insurance protection.
4. Systematic Investment Plans (SIPs) – Equity mutual funds for inflation-beating returns.

For a broader understanding, check out Safest Investment Options in India for Secure Returns and Top 10 Tax Saving Investment Options for FY 2025-26.

Conclusion: Building a Strong Future for Your Daughter

The Sukanya Samriddhi Yojana is undoubtedly one of the best government-backed schemes for securing a girl child’s financial future. With its high interest rate, tax exemptions, and sovereign guarantee, it provides a strong foundation for long-term savings. However, given its restrictions and limited annual investment ceiling, relying solely on SSY may not be sufficient for future education or marriage costs.

By pairing SSY with diversified instruments like mutual funds, tax-saving schemes, and PNB MetLife’s child and savings plans, parents can ensure a well-rounded financial strategy that balances security, growth, and flexibility.

👉 Build financial security for your child’s future with PNB MetLife’s savings and protection plans—designed to complement government-backed schemes like SSY.

Recommendation for MetLife’s Child and Savings Plans

While SSY is a secure government-backed scheme, pairing it with PNB MetLife’s child and savings plans can provide additional growth, flexibility, and insurance protection.

Some options include:

• PNB MetLife Guaranteed Future Plan – Provides guaranteed benefits with flexibility to plan for your child’s milestones.
• PNB MetLife Century Plan – Long-term wealth creation with coverage up to 100 years of age.
• PNB MetLife Smart Platinum Plus – Combines protection and market-linked savings to ensure your child’s education or other milestones are secured, even in unforeseen circumstances.

These plans complement SSY by offering higher coverage, market-linked returns, and flexible payout options, ensuring a holistic financial plan for your daughter’s future.