Kisan Vikas Patra KVP was originally launched in the year 1988 for farmers is now open to all. It is a popular saving certificate scheme from the Indian post office. The scheme doubles your one-time investment in approximately 10 years and 4 months. In this post, we will discuss all you want to know about the Kisan Vikas Patra scheme.
Table of Contents
What is Kisan Vikas Patra?
KVP is a saving certificate scheme launched by India Post in the year 1988. This initiative is taken by the Indian government to encourage long-term financial discipline in the people. Initially, it was introduced for the farmers to enable them to save money for the long term. Now anyone can apply for this scheme.
At present, Kisan Vikas Patra maturity period is 10 years and 4 months (124 months). You can apply for the KVP scheme with a minimum investment of Rs.1,000. There is no maximum limit for it, but you can only apply in the multiple of Rs.100.
In the year 2014, the government has made PAN card proof mandatory for investments above Rs.50,000. If you want to deposit Rs.10 lakh or above now, you have to show your income proof such as ITRs, income statement, form 16, salary slips, etc.
Types of KVP Scheme Accounts
There are three types of KVP accounts.
1. Single Holder: In this type of account, KVP certification is furnished to an adult or on behalf of a minor.
2. Joint A: In this type of account, KVP certification is furnished to two adults jointly. At the time of maturity, the pay-out is payable to both the account holders or to the one who survives till maturity.
3. Joint B: In this type of account, KVP certification is furnished to two adults jointly. At the time of maturity, the pay-out is paid to either of the owners or to the one who survives till maturity.
Here are the Kisan Vikas Patra details, you want to know.
Features of Kisan Vikas Patra Post Office Scheme
1. Guaranteed Returns
You will get guaranteed returns by investing in this scheme regardless of the market fluctuations. Therefore, anyone who wants to earn guaranteed returns should invest in this scheme.
2. Capital Safety
Kisan Vikas Patra post office scheme is a safe investment and not subject to market risks. This is an ideal scheme for those who don’t want to take risks while investing their money.
3. Maturity Period
At present, the maturity period is 10 years and 4 months. However, the Kisan Vikas Patra maturity period may changes from time to time as prescribed by the Ministry of Finance.
4. Minimum Investment Amount
You can start investing with a minimum amount of Rs.1,000. Moreover, there is no maximum limit for investment in KVP. You can invest in a multiple of 100. In this scheme, you can open any number of accounts
5. Rate of Interest on Kisan Vikas Patra 2021
Currently, Kisan Vikas Patra rate of interest 2021 is 6.9% per annum. This interest is compounded annually. If you have invested Rs.1,000. Your invested amount would be Rs.2,000 after 124 months. That means your investment would be doubled in 124 months.
6. Certificate Issuance
You will be issued a KVP certificate hand to hand once you have done the payment through cash. But you might have to wait for the certificate if the payment mode is different.
7. Nomination Facility
You can easily nominate anyone. You just need to collect the nomination form from your nearest post office, fill in the required details about the nominee. Submit the duly filled form to the post office and it is done.
8. Loan under KVP Scheme
You can avail loan against a KVP certificate with low-interest rates. This is one of the best features of the Kisan Vikas Patra post office scheme.
Eligibility Criteria
Following are the eligibility criteria to apply for this yojana.
1. Single Adult: Any adult can apply.
2. Joint Account: A group of up to 3 adults can jointly apply.
3. Guardian: A guardian on behalf of a minor or on behalf of an unsound mind person.
4. Single Minor: Any minor above the age of 10 years can apply in his/her name.
5. NRIs are not eligible to purchase this certificate.
Documents Required
Following documents required in the application process for the KVP certificate:
1. KVP Application Form (Form A).
2. Identity Proof (Aadhaar card, PAN card, Voter’s ID card, Driving License, Passport).
3. Address Proof (Passport, Pan card, Electricity bill, etc.)
4. DOB (Date of Birth) certificate.
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How to get Kisan Vikas Patra?
Following are the steps you need to follow to start your investments in the KVP scheme:
1. Collect the application form “Form A” from the nearest post office or one of the select banks that offer the certificate. Alternatively you can also download the form online.
2. Fill in the required details in the form and submit it back to the bank or post office.
3. You need to submit your identity proof and address proof to complete your KYC verification.
4. After the verification of your documents, you have to make the deposit. You can either pay by cash or any other mode of payment.
5. Once payment is processed, you will get your KVP certificate.
How to buy Kisan Vikas Patra online?
Kisan Vikas Patra online purchase process is not available. However, the application forms are available online as well as at select banks and post offices. The KVP application form is known as “Form A”.
Kisan Vikas Patra Rate of Interest 2021
At present, the post office Kisan Vikas Patra interest rate 2021 is 6.9% per annum. The post office KVP interest rate 2021 is compounded annually. If you have invested Rs.10000. Then your invested amount would become Rs.20000 after 124 months. That means the amount invested doubles in 10 years and 4 months.
Note: The rate of interest of this scheme is subject to change from time to time as per government notification.
Kisan Vikas Patra Withdrawal Rules
The maturity period of KVP is 124 months. After the completion of the maturity period, you can withdraw your funds. You can encash your KVP certificates from the same post office from which it was purchased. You can also encash it from other post offices in case of an emergency. However, you need to fulfill certain formalities. You also need to carry out the same process in case of premature encashment. This is “How to encash Kisan Vikas Patra after maturity?”
Kisan Vikas Patra premature withdrawal can be made in the following cases:
1. In case of the death of the account holder.
2. In case of forfeiture by a pledgee being a Gazette officer.
3. When ordered by the court.
4. After the lock-in period. Kisan Vikas Patra lock in period is 30 months (2 years and 6 months) from the date of deposit.
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Taxability of Kisan Vikas Patra Yojana
You will not get any benefit u/s 80C while investing in the KVP scheme. But after maturity, the interest earned is completely taxable. However, no tax is deducted at the source. We can say that Kisan Vikas Patra taxation is not designed for investors who are looking to save tax.
How to transfer a KVP certificate from one person to another?
KVP scheme may be transferred from one person to another person in the following cases.
1. In case of the death of account holder to nominee/legal heirs.
2. In case of the death of the account holder to the joint holder(s).
3. When an order by the court.
4. In case of pledging of account to the specified authority.
How to transfer the KVP scheme post office?
You can your KVP scheme from one post office to any other, anywhere in India. For this, you just need to collect and fill “Form B” and submit it along with the required documents at your registered post office. Following documents required for this:
1. Duly filled “Form B”
2. Identity proof
3. Address proof
4. Original KVP certificate
5. Application validating the transfer of post office duly signed by the account holder.
Kisan Vikas Patra vs NSC
| Parameters | KVP | NSC |
| Investment Amount | Minimum- Rs.1000 | Minimum- Rs.1,000 |
| Maximum- No limit | Maximum- Rs.1.5 lakh | |
| Interest Rate | 6.9% annually | 6.8% annually |
| Taxation Policy | Returns on KVP are taxable | Enjoys tax benefits and exemption under Section 80(c) |
| Lock-in Period | Lock-in period of 30 months only | Lock-period of 5 years |
| Maturity Period | 124 months (10 years & 4 months | 60 months (5 years) |
| Premature Withdrawal | Withdrawals are allowed before maturity | Withdrawals are allowed but very difficult and restricted |
| Loans | The loans against KVP certificate is possible | Loans against NSC is possible |
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Frequently Asked Questions
1. What is the interest rate on the KVP scheme?
The interest rate on the KVP scheme is 6.9% per annum. Interest is compounded annually.
2. What is the minimum investment for the KVP scheme?
The minimum investment amount for KVP scheme account is Rs.1000. Thereafter, multiples of Rs.100 are required.
3. Are the KVP scheme certificates transferable?
Yes, the KVP scheme certificates are transferrable from person to person, from one post office to another post office, anywhere in India.
4. Can I apply for a duplicate KVP certificate?
Yes, you can apply for a duplicate KVP certificate. You need to apply with the required documents for the duplicate KVP certificate.
5. What is the maturity period for the KVP certificate?
The maturity period of the KVP certificate is 124 months for investment date on or after 01.04.2021 commencing on the date of the certificate.
6. Can I transfer my KVP scheme account post office?
Yes, you can transfer the KVP scheme account post office. For this, you just need to submit the duly filled “Form-B” with all the documents to your registered post office.
7. Can an NRI invest in a KVP scheme?
No, the Non-Resident Indians are not eligible to invest in the KVP scheme.
8. How to encash KVP certificate after maturity?
You have to visit the registered post office along with your KVP certificate and your Id proof. After document verification, you will get a cheque for your full amount.
Final Thoughts
I hope now you know everything about the Kisan Vikas Patra scheme. It is one of the small savings schemes from the post office. The scheme does not offer any tax benefits. The interest rate is also not very high. However, If you are someone who is looking for assured returns, you can consider the KVP scheme.
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