Sunday, 22 March 2015

Sukanya Samriddhi Account (SSY) Pre-Mature Closure And Partial Withdrawal Rules

The duration of the Sukanya Samriddhi account is 21 years from the date of the opening of the account. But there are some scenarios when SSY account is permitted to be closed prematurely.

Beneficiary getting married

SSY account can be closed if marriage of the account holder (girl child) takes place before the completion of 21 years of SSY account.

Earlier SSY account has to be closed in case of marriage but as per new rules, in case of marriage, pre mature closure of the SSY account is allowed with in a month before the marriage or with in three months after the marriage. If SSY account is not closed with in that window, in case of marriage, then it has to be continued till maturity (i.e. 21 years).

If SSY account has to be closed in case of marriage proper proof has to be given that girl is over 18 at that time

Untimely death of the account holder

In the unfortunate event of death of the account holder (girl child), the account shall be closed immediately on production of death certificate issued by the competent authority. In that case the balance at the credit of the account shall be paid along with the accrued interest till the month preceding the month of premature closure of the account, to the guardian of the account holder.

Hardship to the account holder

The other case when Sukanya Samriddhi Yojana account can be closed prematurely is when the central government is satisfied that operation of the account or continuation of the account is causing undue hardship to the account holder (guardian). Authorities may allow pre-mature closure of the SSY account only in cases of extreme compassionate grounds such as medical support in life threatening diseases, death etc. The application for pre-mature closure in this case has to be given with the proper reason.

There is one condition though in this case, pre mature closure is permitted only after the completion of five years of the SSY account opening.

Resident status change for the beneficiary

SSY account is only for resident Indian. After the opening of SSY account, if the account holder becomes a NRI or non-citizen; as per rule no interest shall be deemed to accrue to the account from the day of change in status and the SSY account shall be deemed to be closed prematurely from that date. The intimation for the change in residential status shall be given by the guardian or the accout holder to the concerned post office or bank with in the period of one month from the date of change in citizenship status.

Pre-mature closure for any other reason

Apart from all these scenarios premature closure of the SSY account may be permitted anytime after the opening of an account but in that case the whole deposit shall be eligible only for the interest rate prescribed for the Post Office Savings Bank.

Partial withdrawal rules

Partial withdrawal is permitted, to meet the financial requirements of the account holder for the purpose of higher education.

In this cases partial withdrawal up to fifty percent of the balance at the credit, at the end of preceding financial year shall be allowed. This partial withdrawal will be allowed only when the account holder girl child attains the age of eighteen years or has passed 10th standard, whichever is earlier.

Let's clarify it with an example - If an account is opened for a girl child whose birth date is 10th Aug 2014 then her 18th birthday would be on Aug 10th 2032. Now if fifty percent withdrawal is requested then the sanctioned amount would be the fifty percent of the amount in the SSY account as of 31st march, 2032.

In case you are opting for partial withdrawal to cover higher educaton expenses you need to provide documentary proof in the form of a confirmed offer of admission of the account holder in an educational institution or a fee-slip from such institution clarifying such financial requirement.

Partial withdrawal may be made as one lump-sum or in istalments, not exceeding one per year, for a maximum of five years.

The partial withdrawal is restricted to the actual demand of fee and other admission charges as per the submitted document. So if amount for fee and other charges is coming to less than 50% of the account balance then you are eligible for partial withdrawal upto the amount for fee and other charges.

Points to note -

  • Pre-mature closure of the account is permitted in case of the death of the account holder or when it is causing extreme hardship to the depositor to carry on the operation of the account.
  • NRIs or non-citizens are not permitted to hold SSY account. In case there is a change of status in citizenship of the account holder, SSY account shall be considered closed.
  • Partial withdrawal up to 50% is permitted in case of higher education of the girl child.
  • Partial withdrawal is allowed only when the account holder girl child attains the age of eighteen years or has passed 10th standard, whichever is earlier
  • After the marriage of the girl child SSY account can be closed even if 21 years of SSY account are not completed.

That's all for this topic Sukanya Samriddhi Account (SSY) Pre-Mature Closure And Partial Withdrawal Rules. If you have any doubt or any suggestions to make please drop a comment. Thanks!

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  3. Sukanya Samriddhi Yojana (SSY) Account Interest Rate
  4. Eligibility For Opening a Sukanya Samriddhi Yojana (SSY) Account
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