Sukanya Samriddhi Yojana: 8.2% tax-free interest, rules, and how to open an account for your daughter
SSY offers 8.2% (Q1 FY 2026-27) — among the highest guaranteed rates in India — fully tax-free (EEE). Open for a girl child below 10, deposit ₹250 to ₹1.5L per year for 15 years, and ₹1.5L/year builds approximately ₹70 lakh by maturity. Here's how it works, the withdrawal rules, and how it compares to PPF.
All figures and facts in this article are sourced directly from primary government and regulatory publications — including the Reserve Bank of India, SEBI, EPFO, the Income Tax Department, PFRDA, and IRDAI — and verified before publication. No claim is published from a single source without corroboration.
For informational purposes only. SSY interest rates are reviewed quarterly by the Finance Ministry. Verify the current rate at indiapost.gov.in or nsiindia.gov.in before acting.
The Sukanya Samriddhi Yojana (SSY) is a government-backed savings scheme created specifically for a girl child's future — education and marriage. It currently offers one of the highest guaranteed interest rates among small savings schemes (8.2% for Q1 FY 2026-27), is fully tax-free (EEE), and has a long horizon designed to build a meaningful corpus by the time the child reaches adulthood.
Current interest rate and structure
Interest rate: 8.2% per annum for Q1 FY 2026-27 (April–June 2026), compounded annually.
The rate is reviewed quarterly by the Finance Ministry. SSY has consistently offered among the highest rates of all small savings schemes — higher than PPF (7.1%) and most fixed deposits.
Interest is calculated on the lowest balance between the 5th and the end of each month, and credited at the end of each financial year.
Source: Sukanya Samriddhi Yojana, ClearTax
Who can open an account and when
- The account is opened by a parent or legal guardian for a girl child below the age of 10
- A family can open a maximum of two SSY accounts (one per girl child) — with an exception for twins or triplets
- The account is in the girl child's name; the guardian operates it until she turns 18
- Available at any post office and most authorised banks
Important: The account must be opened before the girl turns 10. If she is already 10 or older, you cannot open a new SSY account for her.
Contribution rules
| Parameter | Rule |
| Minimum deposit | ₹250 per year |
| Maximum deposit | ₹1,50,000 per year |
| Deposit period | 15 years from account opening |
| Maturity | 21 years from account opening |
| Number of deposits | Any number, up to the ₹1.5L annual cap |
You deposit for the first 15 years. From year 16 to year 21, no further deposits are needed — the balance continues earning interest until maturity at year 21.
◇ Quick check: Deposit before the 5th of the month (especially in April) to maximise the interest calculation, which uses the lowest monthly balance.
Tax treatment: EEE
SSY is one of the few fully tax-free (EEE) instruments in India:
- Contributions: Deductible under Section 80C (up to ₹1.5 lakh, old regime)
- Interest: Fully tax-free
- Maturity amount: Fully tax-free
This makes SSY exceptionally efficient for old-regime taxpayers. An 8.2% tax-free return is equivalent to approximately 11.7% pre-tax for someone in the 30% bracket. Even under the new regime (no 80C deduction), the tax-free interest and maturity make it attractive for guaranteed-return savings earmarked for a daughter.
What the corpus looks like at maturity
Example: ₹1,50,000 deposited per year for 15 years at 8.2% (assuming the rate holds, which it may not):
- Total invested over 15 years: ₹22,50,000
- Approximate maturity value at year 21: approximately ₹70 lakh (tax-free)
Illustration assuming a constant 8.2% rate. The actual rate is revised quarterly and will vary over 21 years, so the real corpus will differ.
Even at smaller contributions — say ₹50,000/year — the corpus at maturity is meaningful (approximately ₹23 lakh on the same assumptions), making SSY a strong vehicle for funding a daughter's higher education or marriage.
Withdrawal rules
Partial withdrawal (for higher education):
After the girl turns 18 (or passes 10th standard), up to 50% of the balance at the end of the preceding financial year can be withdrawn for her higher education expenses.
Premature closure:
- On the girl's marriage after age 18 (with documentation)
- In case of the account holder's death
- Otherwise, premature closure is restricted
Full maturity:
The full balance is paid out at year 21, or earlier on the girl's marriage after 18.
SSY vs PPF for a child's future
| SSY | PPF | |
| Interest rate (current) | 8.2% | 7.1% |
| Tax treatment | EEE | EEE |
| Who it's for | Girl child below 10 | Anyone |
| Lock-in | 21 years (deposits for 15) | 15 years |
| Annual limit | ₹1.5L | ₹1.5L |
For a girl child below 10, SSY's higher rate (8.2% vs 7.1%) makes it the better choice for the long-term goal. The ₹1.5L annual limit is shared if you want to use both — so most parents prioritise SSY for a daughter and use PPF for additional or other goals.
⚠ Common mistake: missing the minimum annual deposit
If you do not deposit the minimum ₹250 in any year, the account becomes "discontinued." To revive it, pay ₹250 (the missed minimum) plus a ₹50 penalty per defaulted year. The account still earns interest, but reviving it is required for full functionality. Set up an annual reminder or standing instruction.
Bottom line
- SSY offers 8.2% (Q1 FY 2026-27) — among the highest guaranteed small-savings rates — fully tax-free (EEE)
- Open for a girl child below 10; maximum two accounts per family; ₹250 to ₹1.5L per year
- Deposit for 15 years; matures at 21 years; partial withdrawal allowed for higher education after 18
- ₹1.5L/year for 15 years builds approximately ₹70 lakh by maturity (illustration at constant 8.2%)
- For a daughter's long-term corpus, SSY's higher rate makes it preferable to PPF
Frequently asked questions
Q: I have two daughters. Can I open SSY for both?
A: Yes. A family can open up to two SSY accounts — one for each girl child. The ₹1.5 lakh annual deposit limit applies per account, so you could contribute up to ₹1.5 lakh to each (subject to your 80C deduction being capped at ₹1.5 lakh total across all 80C instruments).
Q: Can I claim 80C for SSY deposits and also for my PPF?
A: The deposits qualify for 80C, but the overall 80C deduction is capped at ₹1.5 lakh combined across all instruments (SSY, PPF, EPF, ELSS, etc.). The investments can exceed ₹1.5 lakh, but the deduction is capped.
Q: What if the interest rate falls over 21 years?
A: SSY's rate is reviewed quarterly. Over a 21-year horizon, the rate will change multiple times. The corpus illustrations assume a constant rate, which will not hold. Historically SSY has stayed among the highest small-savings rates, but the final corpus depends on the actual rate path.
Q: Can the girl child operate the account herself?
A: She can operate it once she turns 18. Until then, the parent or guardian operates it on her behalf.
Sources: Sukanya Samriddhi Yojana, ClearTax · SSY scheme, NSI India · Saving schemes, India Post
Last verified: June 2026. SSY interest rate (8.2%) is for Q1 FY 2026-27 and is revised quarterly. Verify at indiapost.gov.in.
Content on Ek Crore is for educational purposes only. Nothing here is financial advice. Always consult a SEBI-registered advisor, CA, or qualified professional before making investment or tax decisions.