Kisan Vikas Patra (KVP) is a savings scheme available in post offices across India. This initiative by the Indian government promotes small savings for a secure financial future. A minimum of Rs.1000, and any sum in multiples of Rs.100 is to be deposited for opening a KVP account, with no maximum investment limit.
Kisan Vikas Patra (KVP) Introduced in 1988 by the Indian Post for encourages small savings over the long term among the masses for securing their future. It is a risk-free investment option for long-term savings. In this post, we will tell you KVP Interest Rate, Calculator, Online Purchase, Withdrawal Rules, Lock in Period & Tax Benefits.
What is Kisan Vikas Patra?
Kisan Vikas Patra is a small, fixed savings scheme backed by the Government of India. These schemes cater to various financial goals, such as retirement, education, and emergency funds. The minimum investment amount is Rs.1,000, and there is no upper limit. The tenure for the scheme is now 115 months (9 years and 5 months).
Types of KVP Certificates
Kisan Vikas Patra instrument is fixed by govt. and candidates can purchase it through cash / cheque / pay order / demand draft. Indian Residents can only invest and purchase KVP certificates and NRI cannot invest in KVP certificate.
- Single Holder Certificate – Issued to an eligible individual for self/behalf of a minor/minor.
- Joint ‘A’ Certificate – Issued to two eligible individuals, payable to both holders jointly or survivors.
- Joint ‘B’ Certificate – Issued jointly to two eligible individuals, payable to either of the joint holders or the survivors.
KVP Interest Rates
Kisan Vikas Patra interest rate is 7.5% compounded annually. The current KVP interest chart and that for the preceding five financial years are shown below for a better understanding of the interest rates.
Documents Required to Get Kisan Vikas Patra Certificate
When you are filling up application for Kisan Vikas Patra (KVP), you have to keep these documents in hand. Listed below are those
- Address proof
- Birth Certificate
- Identity proof, such as Aadhaar Card, Voter ID, PAN, drivers license, passport.
- And duly filled application form for KVP
Eligibility Criteria
The following is the eligibility criteria for investing in the KVP scheme:
- The applicant has to be an adult resident of India.
- The applicant must be above 18 years of age
- A parent/guardian may invest on behalf of a minor.
- A trustee can purchase a KVP certificate.
- Hindu Undivided Families (HUFs) and Non-Resident Indian (NRIs) cannot invest in Kisan Vikas Patra.
How to apply Kisan Vikas Patra Scheme
Step 1: Go to your nearest Post Office branch where the KVP scheme is available.
Step 2: Ask for the KVP application form (Form-A) and fill in the required details such as name, address, investment amount, nominee details, etc.
Step 3: Submit identity proof (Aadhaar, PAN, Voter ID) and address proof.
Step 4: Make the payment either in cash, cheque, or demand draft.
Step 5: You will receive a Kisan Vikas Patra certificate (either physical or electronic), which serves as proof of investment.
Kisan Vikas Patra vs Fixed Deposits
| Parameters | KVP | FD |
| Investments | Minimum investment of Rs.1000 required whereas there is no capping on maximum investment | Minimum – Rs. 500 Maximum – Not Limited |
| Rate of Interest | 7.5% | Differs from bank to bank |
| Maturity | 9 years 7 months (115 months) | 10 years. However, subscribers can withdraw money after 7 days from the date of investment |
| Tax Treatment | Returns on KVP are taxable | Tax saver FDs are tax exempted for up to Rs. 1.5 Lakh under Section 80 (C) |
| Lock-in periods | Lock-in period of 2 and a half years | No lock-in period. The tenure of Fixed deposits ranges from 7 days to 10 years |
| Premature Withdrawals | Withdrawals are allowed before maturity but it is advised to keep the corpus invested for 124 months to get best returns | Money can be withdrawn as and when the subscriber wants, after 7 days |
If you’re searching for a risk-free and government Schemes, the Kisan Vikas Patra Scheme is worth considering. Any Indian citizen above the age of 18 years can buy a Kisan Vikas Patra from the nearest post office.
FAQs
What are the eligibility criteria for Kisan Vikas Patra?
What are the eligibility criteria for Kisan Vikas Patra?
What is the minimum investment amount for Kisan Vikas Patra?
The minimum investment amount for Kisan Vikas Patra is Rs. 1,000.
Who is eligible to purchase Kisan Vikas Patra?
Kisan Vikas Patra can be purchased by an adult in their own name, an adult on behalf of a minor as a guardian.
What is the interest rate offered by Kisan Vikas Patra?
What is the interest rate offered by Kisan Vikas Patra?
Is Kisan Vikas Patra interest taxable?
The interests on KVP are taxable on accrual basis every financial year and tax is applied on the same as ‘Income from other sources’.
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