When it comes to building a secure future for children, two of the most popular government-backed savings schemes in India are the Public Provident Fund (PPF) and the Sukanya Samriddhi Yojana (SSY). Both offer guaranteed returns, tax benefits, and safety, but they differ in terms of eligibility, interest rates, lock-in periods, and purpose. Let’s compare PPF vs Sukanya Samriddhi Yojana (SSY) to understand which is better for child investment.
Quick Overview – PPF vs Sukanya Samriddhi Yojana (SSY)
| Factor | PPF (Public Provident Fund) | SSY (Sukanya Samriddhi Yojana) |
|---|---|---|
| Who Can Open? | Any Indian citizen (self, spouse, or children) | Parents/guardians of a girl child (up to age 10) |
| Tenure | 15 years (extendable in 5-year blocks) | 21 years (till girl turns 21 or marriage after 18) |
| Minimum Deposit | ₹500 per year | ₹250 per year |
| Maximum Deposit | ₹1.5 lakh per year | ₹1.5 lakh per year |
| Interest Rate | ~7.1% (Govt. revised quarterly) | ~8.2% (Govt. revised quarterly) |
| Withdrawals | Partial after 7 years | Partial (50%) allowed at 18 years |
| Tax Benefit | Section 80C + EEE (fully tax-free) | Section 80C + EEE (fully tax-free) |
| Best For | General long-term wealth & retirement | Girl child’s education & marriage savings |
What is PPF (Public Provident Fund)?
The Public Provident Fund (PPF) is a government-backed savings scheme introduced in 1968 to encourage small savings and provide long-term financial security. It is one of the most trusted investment options for Indian households because it combines safety, guaranteed returns, and tax benefits.
- Open to all Indian citizens (self, spouse, children).
- Tenure: 15 years (extendable in 5-year blocks).
- Minimum deposit: ₹500 per year; maximum: ₹1.5 lakh.
- Current interest rate: ~7.1% (quarterly revised by the Government).
- Offers EEE status (Exempt-Exempt-Exempt): Investment, interest, and maturity are all tax-free.
- Suitable for long-term savings like retirement or children’s education.
What is Sukanya Samriddhi Yojana (SSY)?
The Sukanya Samriddhi Yojana (SSY) is a government scheme launched in 2015 under the Beti Bachao Beti Padhao campaign to promote financial security for the girl child. It is one of the highest interest-paying small savings schemes in India and comes with guaranteed, tax-free maturity.
- Parents/guardians can open an account for a girl child up to age 10.
- Minimum deposit: ₹250 per year; maximum: ₹1.5 lakh.
- Tenure: 21 years (or until the girl gets married after 18).
- Current interest rate: ~8.2% (quarterly revised by the Government).
- Offers EEE status (Exempt-Exempt-Exempt).
- One account per girl child; maximum two accounts allowed per family.
PPF vs Sukanya Samriddhi Yojana (SSY) – Key Differences
| Feature | PPF (Public Provident Fund) | Sukanya Samriddhi Yojana (SSY) |
|---|---|---|
| Eligibility | Any Indian citizen | Girl child (up to 10 years) |
| Tenure | 15 years (extendable) | 21 years (till 21 or marriage after 18) |
| Min/Max Deposit | ₹500 – ₹1.5 lakh | ₹250 – ₹1.5 lakh |
| Interest Rate | ~7.1% | ~8.2% |
| Withdrawals | Partial after 7 years | 50% after girl turns 18 (for education) |
| Purpose | General wealth creation | Education & marriage of girl child |
| Tax Status | EEE | EEE |
PPF or Sukanya Samriddhi Yojana (SSY) – Which is Better for Child Investment?
- Choose SSY if:
- You are saving for a girl child’s education or marriage.
- You want slightly higher returns (~8.2%).
- You are comfortable with a longer lock-in (21 years).
- Choose PPF if:
- You want a flexible scheme for yourself, spouse, or children.
- You want the option to extend after 15 years.
- You are saving for a boy child (since SSY is only for girls).
Example – Investing ₹1.5 Lakh Annually
- PPF:
Deposit: ₹1.5 lakh per year for 15 years.
Maturity: ~₹40 lakh (tax-free at ~7.1%). - SSY:
Deposit: ₹1.5 lakh per year for 15 years.
Maturity: ~₹65 lakh (tax-free at ~8.2% after 21 years).
Result: SSY gives higher maturity but with a longer lock-in and girl child restriction.
FAQs on PPF vs SSY
Q1. Can I invest in both PPF and Sukanya Samriddhi Yojana?
Yes, but the combined 80C limit of ₹1.5 lakh applies.
Q2. Which has better returns – PPF or SSY?
SSY generally offers higher returns (~8.2%) compared to PPF (~7.1%).
Q3. Can a boy child have an SSY account?
No, SSY is only for girl children. For boys, you can use PPF.
Q4. Which is better for retirement – PPF or SSY?
PPF, since SSY is child-specific and locked till the girl turns 21.
Q5. Can I withdraw money early from SSY?
Yes, partial withdrawal (50%) is allowed for higher education at 18 years.
Both PPF and Sukanya Samriddhi Yojana are excellent government-backed savings schemes.
- If your goal is child-specific savings for a girl, SSY is the clear choice due to higher returns.
- If you want a flexible, long-term investment option for retirement or for a boy child, PPF is better.
For balanced planning, many parents invest in both PPF and SSY to cover both retirement and children’s future needs.
Q6. Who can open a PPF account vs an SSY account?
PPF can be opened by any Indian resident adult. SSY can only be opened by parents/guardians for a girl child below 10 years.
Q7. Is the lock-in period the same for PPF and SSY?
No. PPF has a 15-year lock-in (extendable), while SSY matures when the girl turns 21.
Q8. Are tax benefits the same in both schemes?
Yes. Both PPF and SSY fall under EEE status—investment, interest, and maturity amount are completely tax-free.
Q9. Can I extend both accounts after maturity?
PPF can be extended in 5-year blocks. SSY cannot be extended beyond maturity.
Q10. Which is safer – PPF or SSY?
Both are equally safe as they are backed by the Government of India, making them low-risk, guaranteed savings options.
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