Sukanya Samridhi Yojna – A Small Savings Scheme for Better Future
Gender inequality in India is not a recent or shocking phenomenon. Women education is regarded as an unnecessary cost and their marriage expenses as a burden and liability. In order to provide for savings for a girl child, the Government has launched a scheme called Sukanya Samridhi Yojna. This is a commendable effort by the Ministry of Finance aiming at women empowerment and financial independence of women in the country.
Overview of Sukanya Samridhi Yojna
Sukanya Samridhi Yojna is a small deposit scheme of the Government introduced by the Honorable Prime Minister of India Mr. Narendra Modi exclusively for the
brighter future of girl child. This is a girl child prosperity scheme introduced under ‘Beti Bachao Beti Padhao’ program. The scheme from Ministry of Finance was introduced under notification GSR 863 (E). It was published on 2nd December 2014.
This scheme is targeted towards girl child to facilitate two major purposes- proper education and untroubled marriage expenses. Key benefits of Sukanya Samridhi Yojna are that it is affordable, offers a high rate of interest and tax benefit. The target audience of the scheme are girls below 10 years of age. Sukanya Samridhi Scheme is a crucial step towards financial security and liberation provided to the girl children and their parents or guardians.
The bright side towards a brighter future is that the Sukanya Samridhi Yojna details are very easy to understand with no complications.
Eligibility For Opening Sukanya Samridhi Yojna Account
- The Sukanya Samridhi Yojna Account can be opened by the girl’s parents or legal guardian in the name of the girl child.
- A Sukanya Samridhi Yojna Account can be opened at any time after the birth of the girl child. The maximum age for opening an account is 10 years.
- The girl should be a resident Indian citizen at the time of opening the account and should remain so until the maturity or closure of the account.
- The depositor cannot open and operate two accounts for the same girl child.
- Maximum two accounts can be opened for two girl children from the same family. The third account can be opened in the event of the birth of twin girls.
The depositor can avail the benefits of Sukanya Samridhi Yojna by opening an account at the nearest post office or an authorized branch of any commercial bank.
Requirements For Opening Sukanya Samridhi Yojna Account
To open the Sukanya Samridhi Yojna Account, the child’s natural guardian must submit the following documents:
- Account opening form with the required details at the post office or bank, wherever such account is being opened.
- ID proof of the child’s natural guardian such as passport, voter ID, PAN card, etc.
- Address proof of the guardian such as voter ID, passport, telephone or electricity bill, etc.
- The birth certificate of the girl in whose name the account is to be opened.
Sukanya Samridhi Yojna Account – Limit of the Deposits
- Under the Sukanya Samridhi Yojna details, the depositor has to deposit a minimum amount of Rs. 1000 as an initial deposit. Thereon, any amount in multiple of Rs. 100 can be deposited but shall not exceed Rs. 1,50,000 in a financial year.
- A penalty of Rs. 50 per year will be attracted if the minimum amount is not deposited.
Mode of Deposit
The depositor can deposit the desired amount in the Sukanya Samridhi Yojna Account by way of cash, cheque or demand draft. He can also transfer the contributions through e-transfer via the internet.
Maturity Period, Closure and Withdrawal of Sukanya Samridhi Yojna Account
- The maturity date of the account will be the date of completion of 21 years from the date of opening of the account.
- The closure of the account is possible only when the girl completes 21 years of age. Premature closure of an account is done in the event of the death of the account holder or in cases of life-threatening diseases. However, closure of Sukanya Samridhi Yojna Account requires the production of certain documents and compliance of the rules.
- Withdrawal of fifty percent of balance amount is permissible only when the girl turns 18 years of age. Such amount withdrawn can be used for the purpose of higher education of the girl.
Rate of Interest Under Sukanya Samridhi Yojna Account
The Government fixes the rate of interest on deposits on a yearly basis. The yearly rates of interest since the launch of this scheme are as follows-
- From April 1, 2014 – 9.1%
- From April 1, 2015 – 9.2%
- From April 1, 2016 – 8.6%
- From April 1, 2017 – 8.4%
This is not just a scheme that uplifts the position of women in the country but also benefits the parents or guardians who operate the account on the girl’s behalf by providing tax exemptions and high rates of interest among other benefits.
Benefits Under Sukanya Samridhi Yojna
- The Sukanya Samridhi Yojna offers attractive rates of interest such as 8.6% and 9.2%. This is more than what the other schemes in market offer.
- Account holder can avail tax benefits under Section 80C of the Income Tax act for the deposits made towards Sukanya Samridhi Yojna. The maximum limit for tax deductible under this scheme is Rs. 1,50,000p.a. This scheme is exempted from tax in all its stages such as deposit, growth and withdrawal which makes it a 100% tax-free scheme.
- Partial withdrawals from the Sukanya Samridhi Yojna Account are possible after the girl attains 18 years of age for the purposes of marriage or higher studies only.
- The promoters and facilitators under Sukanya Samridhi Yojna are banks and post offices. They have high penetration in terms of coverage in both rural and urban India. This facilitates convenient and expedient opening of accounts for parents willing to save for their girl child’s prosperous and successful future.
- Sukanya Samridhi Yojna Account can be transferred from one post office to the other or another bank and vice-versa. The account is transferable from one location to another in the country to maintain this scheme as hassle free as possible.
- An important feature of this scheme is the flexibility with regard to the deposit amount and the frequency of deposit. Deposits to Sukanya Samridhi Yojna Account can be made by people coming from the different economic background and at the convenience of the depositor or the account holder.
The Sukanya Samridhi Yojna is often compared with Public Provident Fund (PPF) as both of these are small saving schemes. But one pertinent point of differentiation is that the purpose associated with Sukanya Samridhi Yojna is more focused and definite option for investment and savings. The amount after maturity of the scheme is given directly to the girl child hence ruling out any misuse of the funds.
With a regressive mindset of the people who give preference to male child’s education, the Government’s initiative to eradicate gender discrimination and introduce schemes for development of women in the country is applaud worthy.