PPF vs Sukanya Samriddhi Account - Difference Between SSY and PPF

When you’re looking at safe, government-backed savings schemes in India, two popular options are the Public Provident Fund (PPF) and the Sukanya Samriddhi Yojana (SSY). While both are excellent for long-term goals and come with tax advantages, they serve different purposes and have distinct features. Here’s a beginner-friendly breakdown of each scheme and how they differ, so you can decide which one suits your goal best.

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What each scheme is

• PPF (Public Provident Fund): A long-term savings scheme you can open as an individual resident of India. It helps build a general retirement corpus or long-term fund.
• SSY (Sukanya Samriddhi Yojana): A scheme specifically meant for a girl child’s future (education/marriage). A guardian opens the account in the name of the girl child (below 10 years of age) and deposits there till a prescribed time.

Key features & differences

Here is a side-by-side look at some important parameters:

Feature

PPF

SSY

Who can open

Any Indian resident (adult or minor via guardian) can open one PPF account.

Only for a girl child; opened by parent/guardian before the girl turns 10 years.

Number of accounts

One per individual.

One per girl child; up to two accounts per family normally.

Minimum/maximum deposit per year

Minimum ₹500; maximum ₹1.5 lakh in a year.

Minimum ₹250; maximum ₹1.5 lakh in a year.

Tenure / maturity

15 years from account opening, then extension in blocks of 5 years possible.

Matures 21 years from opening or when the child marries after 18 (whichever earlier) in some cases.

Interest rate

Slightly lower; e.g., for recent quarter 7.1% p.a. for PPF.

Higher interest; e.g., for recent quarter 8.2% p.a. for SSY.

Purpose

General long-term savings, retirement corpus, flexible goals.

Securing the future of a girl child, education, marriage, etc.

Partial withdrawal / loan facility

Partial withdrawal allowed after 5-6 years; loans allowed in early years (3rd-6th year) in PPF.

Withdrawals only when the girl reaches 18 years (for education/marriage); no loan facility.

Nomination facility

You can nominate someone for your PPF account.

No nomination while the girl child is alive; account is in her name.

Flexibility of use

Very flexible, can use for any goal, extend tenure, transfer accounts.

Less flexible, tied to the girl child’s timeline and purpose.

Which one is better for what goal

• If your goal is long-term savings for retirement or general future needs, and you value flexibility, then PPF is likely a better fit.
• If your goal is securing a girl child’s future, via her education or marriage, and you are okay with a scheme with less liquidity but higher interest, SSY makes sense.
• You can also use both: e.g., open SSY for the daughter and put extra savings in PPF for yourself or other goals. Many experts suggest doing both to diversify.

Things to keep in mind

• While SSY offers higher interest, its lock-in is longer and the account is restricted in terms of use and withdrawal.
• PPF’s lower interest is offset by its broader eligibility and greater flexibility (withdrawals, extensions, general use).
• For both schemes: deposits qualify for deduction under Section 80C (up to ₹1.5 lakh per year) and interest & maturity amounts are tax-free under EEE category (Exempt-Exempt-Exempt) in many cases.
• Inflation and long-term horizon matter: though interest may look high, consider what real returns you’ll get after inflation especially if your goal is many years ahead.
• Always check latest interest rate notifications quarterly for these schemes, as rates are reviewed.

Summary

• PPF = any resident individual, flexible long-term savings, moderate interest, usable for general goals.
• SSY = only for a girl child, very long horizon (21 years), higher interest, less flexible, targeted at her future.
  Choose based on who the savings is for, what the goal is, how soon you’ll need the money, and how flexible you want the scheme to be.