Tax & Savings
SSY vs PPF
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Sukanya Samriddhi Yojana vs PPF — both government-backed, but SSY has a higher rate. When to choose which.
What Sukanya Samriddhi and PPF Actually Mean
Sukanya Samriddhi. The Sukanya Samriddhi Account is a government small savings scheme for a girl child. It can be opened any time from her birth until she turns 10, takes deposits of ₹250 to ₹1.5 lakh a year for up to 15 years, and matures 21 years from the opening date. The current rate is 8.2%, reset quarterly by the government.
PPF. The Public Provident Fund is a 15-year government savings account open to any resident individual, taking ₹500 to ₹1.5 lakh a year at a rate currently 7.1%, also reset quarterly. It is extendable in five-year blocks.
Both are government-backed, both are exempt-exempt-exempt, and both share the same ₹1.5 lakh annual ceiling. The differences that actually decide this are eligibility, the rate gap, and who controls the money at the end. SSY pays more, but it is tied to one girl child, matures on her timetable rather than yours, and becomes hers.
Key Differences
| Feature | SSY | PPF |
|---|---|---|
| Who can invest | Parents of girl child (under 10) | Any resident individual |
| Interest rate | 8.2% p.a. (FY 2024–25) | 7.1% p.a. |
| Lock-in | 21 years (or marriage after 18) | 15 years |
| Max contribution | ₹1.5 lakh/year | ₹1.5 lakh/year |
| Tax | EEE — fully exempt | EEE — fully exempt |
| Who it is for | A girl child, account opened before she turns 10 | Any resident individual |
| Current rate | 8.2% | 7.1% |
| Deposit period | 15 years from opening | 15 years, extendable in 5-year blocks |
| Maturity | 21 years from opening | 15 years, extendable |
| Accounts permitted | Two per family, with exceptions for multiple births | One per individual |
| Who the money belongs to at maturity | The girl, once she is an adult | You |
When to Choose Which
Choose SSY
- You have a daughter under 10 years
- Long-term savings for girl’s education/marriage
- Want higher guaranteed rate than PPF
- EEE status with government guarantee
Choose PPF
- No girl child or child over 10
- You want shorter lock-in (15 vs 21 years)
- Need to access funds before daughter’s marriage
- Building personal retirement corpus
Worked Examples
Assume ₹1.5 lakh a year. Use the calculator above for your own figures.
| Scenario | Sukanya Samriddhi | PPF |
|---|---|---|
| You want the highest guaranteed rate | 8.2% — among the highest of any government scheme | 7.1% |
| You have no daughter, or she is over 10 | Not available | Available to anyone |
| You need the money at year 12 | Not available except for the education withdrawal or specified closure grounds | Partial withdrawal permitted after year 5 |
| You want the corpus for your own retirement | It becomes hers, not yours | It is yours |
| Her college fees fall due at 18 | Up to 50% of the previous year’s balance may be withdrawn | Partial withdrawal, subject to the year-5 rule |
If you are working backwards from what her education will actually cost, the child education planning calculator sizes the target first. Rows three and four are what people miss. SSY’s higher rate is real and worth roughly a percentage point a year compounded over two decades — but the account matures 21 years after opening, not when you need it, and the money is the girl’s. That is the point of the scheme, not a defect, but it means SSY cannot double as your own long-term savings.
How Each Is Taxed
Both are exempt-exempt-exempt: the contribution qualifies for a deduction, the interest accrues tax-free, and the maturity amount is tax-free. There is no TDS on either and no threshold above which interest becomes taxable — which is what distinguishes both from a fixed deposit paying a comparable rate.
The catch on the way in. The deduction on both is under section 80C, which is available only under the old regime, and the new regime is now the default. If you are on the new regime, contributions to either give you no deduction — but the exemption on interest and maturity still applies under both regimes, and that is the larger benefit over a twenty-year horizon. A tax-free 8.2% is equivalent to roughly 12% before tax for someone in the 30% bracket, which almost nothing else guaranteed can match.
They share one ceiling. The ₹1.5 lakh annual limit under 80C is shared across SSY, PPF, ELSS, EPF, life insurance premium and the rest. Funding both to their maximum is possible, but the deduction is capped once.
Rates on both schemes are reset quarterly by the government. The figures above are current at the time of review — check the notified rate for the current quarter before you commit.
Advantages and Limitations
Sukanya Samriddhi
Works for you when
- The highest rate among comparable government schemes, currently 8.2%
- Exempt-exempt-exempt with no interest threshold
- A hard structure that stops the money being spent on something else
- Withdrawal available for her higher education
Watch out for
- Only for a girl child, and only if opened before she turns 10
- Matures 21 years from opening, not when you need it
- The money becomes hers, so it cannot serve as your retirement corpus
- Two accounts per family
PPF
Works for you when
- Open to anyone, with no eligibility conditions
- Partial withdrawal from year 5 and a loan facility from year 3
- Extendable in five-year blocks, with or without further contributions
- The corpus remains yours
Watch out for
- A lower rate than SSY, currently 7.1%
- ₹1.5 lakh annual cap
- 15-year commitment
- No equity exposure, so limited protection against long-run inflation
How to Decide
This is less of a contest than it looks.
- Do you have a daughter under 10? If not, the question does not arise — PPF is the only one of the two available to you.
- Is this money specifically for her education or marriage? If yes, SSY’s higher rate and its enforced structure both work in your favour.
- Might you need the money yourself? Then PPF, without hesitation. SSY money is hers and the maturity date is fixed by her age, not your needs.
- Can you fund both? The ₹1.5 lakh deduction is shared, but nothing stops you contributing to both if the cash flow exists. The 80C ceiling limits the deduction, not the deposit.
- Is this the whole plan? Both are guaranteed and both are conservative. Over an 18-year horizon a portion in equity has historically done considerably more work. Use these as the floor, not the entire structure.
A common structure for parents of a young girl is SSY for the guaranteed core, an equity SIP for the growth neither scheme provides, and PPF separately for the parent’s own long-term money.
Frequently Asked Questions
Sources and Method
Scheme terms below are taken from Government of India material rather than from secondary summaries.
- Sukanya Samriddhi terms — Press Information Bureau release on the Sukanya Samriddhi Yojana, January 2026: rate currently 8.2%; deposits ₹250 to ₹1.5 lakh a year for up to 15 years; maturity 21 years from opening; account may be opened until the girl turns 10; two accounts per family with exceptions for multiple births; 50% withdrawal for higher education after age 18 or class 10.
- PPF terms and rate — Ministry of Finance quarterly small savings rate notification; 7.1% for the current quarter.
- Deduction — Income Tax Act, section 80C, ₹1.5 lakh, available under the old regime only. Interest and maturity exempt under both regimes.
- Rates on both schemes are notified quarterly and can change.
Last reviewed 17 August 2026. This page is general information, not advice.