A direct comparison of Sukanya Samriddhi Yojana and Public Provident Fund for parents planning a daughter’s education or marriage fund. Covers interest differences, lock-in rules, withdrawal limits, and a working calculator.
If you have a daughter under 10 years old, Sukanya Samriddhi Yojana (SSY) gives you 8.2% interest compared to 7.1% in Public Provident Fund (PPF). That 1.1% difference creates over Rs. 10.42 lakh in extra tax-free interest on a Rs. 1.5 lakh yearly deposit over 21 years. Both schemes carry sovereign government guarantees, and both keep your returns completely tax-free.
The choice between them depends on how much flexibility you need. SSY locks the money until your daughter turns 18, while PPF lets you borrow or withdraw funds much sooner. You can test your exact numbers with our free calculator below.
Quick Verdict: Choose SSY as your primary vehicle if your daughter is eligible and the money is strictly meant for her college degree or marriage at age 21. The higher interest rate compounds into significantly more money. Choose PPF if you need liquidity before she turns 18, or if you want to keep direct control of the funds after she becomes an adult.
- SSY pays 8.2% per year, while PPF pays 7.1% per year. Both rates are reviewed quarterly by the government.
- SSY deposits stop after 15 years, but the balance continues earning 8.2% interest until it matures at 21 years.
- PPF matures at 15 years, and you can extend it indefinitely in 5-year blocks with or without fresh deposits.
- Both schemes enjoy EEE tax status: deposits qualify for Section 80C under the old regime, and interest and withdrawals are tax-free in both regimes.
- At age 18, your daughter legally takes over the SSY account, and the maturity payout goes directly to her bank account.
- PPF offers loans from year 3 and partial withdrawals from year 7, while SSY allows no withdrawals until your daughter turns 18.
Core Differences Explained
Before looking at the final corpus numbers, look at the legal rules that govern each scheme.
Side-by-Side Comparison Table
| Feature | Sukanya Samriddhi Yojana (SSY) | Public Provident Fund (PPF) |
|---|---|---|
| Current Interest Rate | 8.2% per year | 7.1% per year |
| Who Can Open | Parent/guardian for a girl child below age 10 | Any Indian citizen of any age (self or minor child) |
| Deposit Period | 15 years from account opening | 15 years (extendable in 5-year blocks) |
| Maturity Period | 21 years from account opening (or marriage after 18) | 15 years |
| Minimum Annual Deposit | Rs. 250 | Rs. 500 |
| Maximum Annual Deposit | Rs. 1,50,000 per account | Rs. 1,50,000 total across self and minor accounts |
| Account Ownership at Age 18 | Transfers fully to the daughter | Remains with the parent/guardian until closed |
| Loan Facility | No loan facility available | Available from 3rd to 6th financial year |
| Premature Partial Withdrawal | Up to 50% after age 18 (higher education only) | Up to 50% from 7th financial year (any reason) |
| Tax Treatment | EEE (Completely tax-free) | EEE (Completely tax-free) |
Five Deciding Factors for Parents
The 1.1% Interest Rate Gap Compounds Heavily
A difference of 1.1% sounds small over one year, but it becomes huge over two decades. If you deposit Rs. 1,50,000 every year for 15 years, your total out-of-pocket deposit is Rs. 22,50,000. At 8.2% in SSY, that money grows to Rs. 71,82,119 by year 21. In PPF at 7.1%, leaving the same money until year 21 yields Rs. 61,39,600. SSY puts an extra Rs. 10,42,519 in your daughter’s hands without taking any market risk.
Maturity Timeline and Educational Milestones
If you open an SSY account when your daughter is 1 year old, it matures when she turns 22, right when she finishes an undergraduate degree. If you open it when she is 8 years old, it matures when she is 29. PPF matures strictly at the end of 15 financial years regardless of her age. Check our Education Planning Calculator to see when you will need fees relative to these dates.
Account Control Shifts to Your Daughter at Age 18
By law, an SSY account belongs to the girl child. The moment she turns 18, the post office or bank requires her KYC documents, and she becomes the sole operator. When the account matures, the money goes into her bank account. A PPF account opened by a parent for their daughter can be managed and closed by the parent, giving parents total control over how the funds get used.
Emergency Liquidity and Loan Options
SSY is an illiquid instrument. You cannot borrow against it, and you cannot touch the money before your daughter turns 18, even in a financial emergency. PPF is far more practical if you lack an independent emergency fund. PPF allows short-term loans between year 3 and year 6 at 1% above the PPF interest rate, and permits partial withdrawals from year 7 onwards.
Deposit Caps for Multiple Children
You can open SSY accounts for up to two daughters and deposit up to Rs. 1,50,000 in each account annually, allowing a family to park Rs. 3,00,000 per year in government-backed, tax-free savings. In PPF, the annual Rs. 1,50,000 ceiling applies across the parent and all minor accounts combined. Depositing more than Rs. 1.5 lakh across your own PPF and your child’s PPF earns zero interest on the excess amount.
Compare SSY vs PPF Maturity Value
Enter your planned annual deposit to see the exact returns and the wealth difference at 21 years.
Assumes constant interest rates (8.2% for SSY, 7.1% for PPF) compounded annually with deposits made at the start of each financial year for 15 years. PPF at 21 years reflects a 15-year maturity extended for 6 years without adding fresh capital. Government rates are reviewed quarterly.
Open the full Sukanya Samriddhi Calculator → | Open the full PPF Calculator →
A Real Comparison: Rs. 1,50,000 Yearly Deposit
Consider a parent who starts investing Rs. 1,50,000 every year from their daughter’s second birthday.
On the exact same Rs. 22.50 lakh deposit, SSY yields Rs. 10.42 lakh more than PPF over 21 years. If you wanted PPF to match SSY’s Rs. 71.82 lakh total, you would have to keep depositing Rs. 1.5 lakh every year for all 21 years, putting in an additional Rs. 9,00,000 of your own money.
Factoring in Inflation: Over a 21-year horizon, education inflation in India typically runs between 8% and 10%. While SSY protects your principal with guaranteed returns, you should also pair it with equity mutual funds to beat college tuition inflation. Check our Inflation Calculator and SIP Calculator to model a balanced portfolio.
Want to see the numbers for your daughter’s exact age? Run different deposit amounts and check your final tax-free payout.
Try The Sukanya Samriddhi CalculatorWhich One Should You Choose?
| Situation | Best Choice | Reason |
|---|---|---|
| Daughter is below 10 and goal is college or wedding at 21 | SSY | Higher 8.2% interest generates maximum tax-free wealth over 21 years |
| You need access to money for school fees before age 18 | PPF | Allows partial withdrawals from year 7 and loans from year 3 |
| You want to retain ownership of the account after she turns 18 | PPF | Parent continues managing the account; SSY transfers legally to the daughter |
| You have two daughters and want to save Rs. 3 lakh yearly | SSY | Can deposit Rs. 1.5 lakh in each girl’s account; PPF caps total at Rs. 1.5 lakh |
| You want a flexible combination of high returns and liquidity | Both | Open SSY for the guaranteed interest boost and PPF for emergency loan access |
Please Note: Small savings scheme interest rates are reset quarterly by the Government of India. The returns shown here use current rates and assume regular contributions. This guide is for educational purposes. Consult a certified financial planner for individual investment advice.
Can I open both SSY and PPF for the same daughter?
Yes. You can open an SSY account in your daughter’s name and also open a PPF account in her name (or in your own name). The deposit limit is Rs. 1.5 lakh per financial year for each scheme. If you invest in both, you can save up to Rs. 3 lakh annually across the two accounts, though the tax deduction under Section 80C in the old tax regime stays capped at Rs. 1.5 lakh total.
What happens to the SSY account after my daughter turns 18?
Once your daughter reaches age 18, she becomes the sole operator of the account. She can withdraw up to 50 percent of the previous year’s balance to pay for higher education fees. The remaining balance stays in the account until full maturity at 21 years from the account opening date, or until her marriage.
Can I withdraw money from PPF before 15 years?
Yes. PPF allows partial withdrawals starting from the 7th financial year. You can withdraw up to 50 percent of the balance at the end of the fourth preceding year, or the preceding year, whichever is lower. You can also take a loan against your PPF balance between the 3rd and 6th financial year.
Does the government change the interest rates on SSY and PPF?
Yes. The Ministry of Finance reviews interest rates for all small savings schemes every quarter. Currently, SSY offers 8.2 percent per year and PPF offers 7.1 percent per year. When rates change, the new rate applies to your entire existing balance going forward.
Are maturity proceeds from SSY and PPF taxable under the new tax regime?
No. The interest earned and the final maturity amount from both SSY and PPF are completely exempt from income tax under both the old and new tax regimes. The new tax regime only removes the Section 80C deduction on fresh deposits.
What if I miss the annual minimum deposit?
If you do not deposit the minimum required amount (Rs. 250 for SSY and Rs. 500 for PPF) in any financial year, your account becomes inactive. You can revive an inactive account by paying a penalty of Rs. 50 per defaulted year along with the minimum deposit for each missed year.
