Government Boosts Sukanya Samriddhi Yojana Returns: Interest Rates Hiked for Q1 2024
The interest rates for the Sukanya Samriddhi Yojana (SSY) have been increased by 20 basis points for the January-March quarter by the Narendra Modi government, preceding the Lok Sabha polls in 2024. As per a circular from the finance ministry, the Sukanya Samriddhi scheme will now offer an interest rate of 8.2%, up from the previous 8%. The government routinely notifies the interest rates for small savings schemes, predominantly managed by post offices, on a quarterly basis.
Key Features of SSY:
- Government Backing for Guaranteed Returns: Sukanya Samriddhi Yojana is a government-backed scheme, ensuring investors of guaranteed returns.
- Income Tax Benefits: Investors can avail income tax benefits on amounts up to ₹1.50 lakh invested in an SSY account within a single financial year under Section 80C of the Income Tax Act.
- Tax-Free Interest: The interest generated through the Sukanya Samriddhi Account (SSA) is exempt from taxation.
- Contributions: The minimum annual contribution to the Sukanya Samriddhi Account is ₹250, and the maximum is ₹1.5 lakh in a financial year.
Withdrawal and Maturity Rules:
Upon reaching 18 years of age, guardians can withdraw up to 50% of the balance in the account in a financial year. Withdrawals can be made in a single transaction or installments, with a maximum of one withdrawal per year, up to a limit of 5 years, in accordance with the regulations set by the Department of Posts.
Apart from SSY, the government has increased the interest rates for the three-year term deposit scheme by 10 basis points for the January-March quarter, while maintaining rates for other small savings schemes. The new interest rates for various schemes for the January-March 2024 quarter are as follows:
- PPF (Public Provident Fund) – 7.1%
- 5-Year RD (Recurring Deposit) – 6.7%
- SCSS (Senior Citizens Savings Scheme) – 8.2%
- 1-Year Deposit – 6.9%
- 2-Year Deposit – 7.0%
- 3-Year Deposit – 7.1%
- 5-Year Deposit – 7.5%
- Sukanya Yojana – 8.2%
- Kisan Vikas Patra – 7.5%
- NSC (National Savings Certificate) – 7.7%
- PO-Monthly Income Scheme – 7.4%
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