The Sukanya Samriddhi and has grabbed the attention of investors, because it is pretty much an exclusive scheme for the girl child.

While the best scheme to compare would be the PPF, it is beacuse under both the schemes there is a complete tax exemption of interest income. Both the schemes also get tax benefit under Sec 80C of the Income Tax Act.

However, both the interest rates will be notified by the government on a yearly basis and it does not offer a fixed income through the life of the investment. Interest will be calculated on yearly basis by compounding method.

Now let us see some difference and similarities between the two

Conclusion

Both have the same tax benefit, however, if you want to choose between the two for a girl child one can consider Sukanya Samriddi account as it offers higher tax benefit than PPF.

Lock in period is high and no loan facility will only help you to save more and at the best benefit out of it.

If you are not a traditional investor, this product may not suit you as there is no online facility as of now and less liquidity compared to PPF.

Just a word of caution, which we ourselves are not clear on. What happens when the bread earning member, who used to contribute in the Sukanya Samriddhi expires and they cannot contribute say after 5 years.

There is a lock-in period that is applicable and what happens when one cannot contribute and cannot withdraw.

Perhaps, we need to study more on this guideline.

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