Sukanya Samriddhi vs PPF for a Girl Child: The Complete Comparison

When parents plan for a daughter's education and marriage, two government-backed schemes dominate the conversation: Sukanya Samriddhi Yojana (SSY) and the Public Provident Fund (PPF). Both enjoy EEE (Exempt-Exempt-Exempt) tax status — your contribution qualifies for Section 80C deduction, interest earned is tax-free, and the maturity amount is fully exempt from income tax.

The critical difference is the interest rate: SSY currently pays 8.2% per annum (Q4 FY2025-26) while PPF pays 7.1%. Over a 15-21 year horizon, this 1.1 percentage point gap compounds into a significant wealth difference. Use the SSY calculator and PPF calculator to model the exact numbers with your planned deposit amounts.

But returns are not the only factor. Lock-in periods, withdrawal rules, account transfer flexibility, and what happens if your daughter moves abroad or marries early all matter. This guide compares every dimension so you can make an informed choice — or decide to use both.

Interest Rate Comparison: SSY vs PPF

The Government of India sets small savings interest rates quarterly. As of Q4 FY2025-26 (January-March 2026), SSY pays 8.2% per annum compounded annually, while PPF pays 7.1% per annum compounded annually. SSY has consistently offered 50-130 basis points more than PPF since its launch in 2015.

Maturity Amount Projection: Side-by-Side Numbers

Let us compare what happens when you invest ₹1.5 lakh per year (the maximum for both schemes) at current rates. SSY allows deposits for 15 years but the account matures when the girl turns 21, so interest continues accruing for 6 more years without deposits. PPF has a straight 15-year maturity with optional 5-year extensions.

The SSY maturity amount is 50-70% higher than PPF for the same annual deposit, driven by both the higher interest rate and the 6 additional years of compounding. Use the SSY calculator to project exact amounts for your deposit plan.

Lock-in and Withdrawal Rules

SSY lock-in: strict but purposeful

SSY locks funds until the girl turns 21 (maturity). A partial withdrawal of up to 50% of the balance is allowed after the girl turns 18, strictly for higher education expenses. The girl must provide admission proof from a recognised institution. Premature closure is allowed only in limited circumstances: the account holder's death, extreme compassionate grounds (life-threatening illness), or marriage after age 18.

PPF lock-in: more flexible

PPF matures in 15 years. Partial withdrawals are allowed from the 7th financial year onwards, up to 50% of the balance at the end of the 4th preceding year or the balance at the end of the preceding year, whichever is lower. Premature closure is allowed after 5 years for specific reasons including serious illness, higher education, or change in residency status. After 15 years, the account can be extended in 5-year blocks with or without fresh contributions.

Tax Benefits: Both Are Fully EEE

Both SSY and PPF enjoy the coveted EEE (Exempt-Exempt-Exempt) status under the Indian Income Tax Act:

Exempt 1 (Investment): Contributions qualify for deduction under Section 80C up to ₹1.5 lakh per financial year. This deduction is available only under the old tax regime. Under the new tax regime, Section 80C deductions are not available, but the interest and maturity remain tax-free.

Exempt 2 (Growth): Interest earned each year is completely tax-free. There is no TDS, no need to declare it as income.

Exempt 3 (Withdrawal): The maturity amount, including all accumulated interest, is fully exempt from income tax. No capital gains tax applies.

This triple exemption makes both schemes among the most tax-efficient savings options in India. For a comparison with other Section 80C options, see the ELSS vs PPF comparison.

Eligibility and Account Opening Rules

When to Choose SSY Over PPF

Your daughter is under 10 years old and you want maximum long-term wealth accumulation. The higher interest rate and 21-year compounding period make SSY the superior choice for building a large corpus for higher education or marriage.

You are comfortable with a 21-year lock-in. If you have other liquid investments and emergency funds, the SSY lock-in is not a concern. The inability to withdraw actually protects the corpus from premature spending.

You want guaranteed returns with government backing. SSY is backed by the Government of India with sovereign guarantee. The interest rate has never gone below 7.6% since the scheme launched in 2015.

When to Choose PPF Over SSY

You need flexibility for withdrawals. PPF allows partial withdrawals from year 7 without restrictions on the purpose of the withdrawal. SSY restricts partial withdrawals to higher education expenses after age 18.

Your daughter is over 10 years old. SSY cannot be opened if the girl is 10 or above. PPF has no age restriction and can be opened as a minor account with a guardian, then transferred to the child's name at 18.

You want to save for yourself or a son. SSY is exclusively for girl children. PPF is available to any Indian resident, making it the default choice for boys or for your own retirement savings.

The Optimal Strategy: Use Both

For most families with a daughter under 10, the optimal approach is to use both schemes. Deposit the maximum ₹1.5 lakh per year in SSY for the higher interest rate. If you have additional savings capacity beyond ₹1.5 lakh, open a PPF account for the girl as well. The PPF gives you a liquidity buffer that SSY does not — if you need funds for an emergency or an intermediate education expense before she turns 18, the PPF partial withdrawal option is available from year 7.

Remember that the total Section 80C deduction across all instruments is capped at ₹1.5 lakh under the old tax regime. If you are already claiming the full ₹1.5 lakh through SSY, the PPF contribution will not provide additional tax benefit but the interest will still be tax-free. For a detailed comparison of all Section 80C instruments, see our SSY calculator guide and PPF calculator guide.