Kisan Vikas Patra: Interest Rates and Features | How to double your Money

If you are looking for a saving scheme in the certificate format, then Kisan Vikas Patra would be the best choice for you. This is quite a popular scheme among Indian citizens and is definitely one of the best that is out there.

Kisan Vikas Patra

But now you must be wondering what is it that attracts investors towards this scheme. Well, it doubles your investment after a period of 10 years and 4 months, which is equivalent to 124 months.

If you have always spent time wondering how to double your money, then this could be your chance to go about it right. If you invest an amount of INR 5,000 in it, you will get a post maturity corpus of INR 10,000. Hence, if you are interested to grow your money, then you can purchase this investment scheme from an Indian post office branch or from any of a few chosen public sector banks.

Now, let’s dig deeper into the details of What is Kisan Vikas Patra in the Indian Post Office. This scheme was introduced by India Post in 1988. The main aim of this small saving certificate scheme is to inculcate long-term financial discipline in investors.

If you purchase a Kisan Vikas Patra certificate on any day between the 1st of April, 2020, and 30th of June, 2020, then you will have to invest your money for the above mentioned pre-determined time period i.e. 124 months.

The minimum amount that you need to invest in this scheme is INR 1000. And there is no upper cap for this investment. However, if you want to invest INR 10 lakhs or above, you will have to produce your income proof at the time of verification.

Further, the name of the scheme includes the word ‘Kisan’ because it was originally introduced for the betterment of farmers. Nonetheless, it is now available for everyone, and you can sure capitalise on it.

Types of Kisan Vikas Patra Certificate

Before understanding various features of the scheme, let’s talk about the types of certificates available against it-

Joint ‘A’ type certificate- This certificate is provided to two adults who apply jointly. And the corpus is paid jointly to both the holders. If, however, one of the holders die, the survivor receives the entire corpus.

Joint ‘B’ type certificate- This certificate is provided to adults who apply jointly. But the corpus is paid to either of the holders. In case of the death of one of the holders, the survivor receives the corpus.

Certificate for single holders – This particular certificate is provided to both adults and minors. If you are an adult, then you can get this certificate for yourself or on behalf of a minor. However, a minor can get such a certificate for himself too.

Features of Kisan Vikas Patra Scheme

  1. One of the most important features of this scheme is that it is a small saving certificate scheme. That means you won’t need a lot of money at hand to be able to invest in it. It is also a low-risk investment avenue. Hence, you can deposit your money in it safely for the entire tenure. This is definitely one of the most vital Kisan Vikas Patra Features.
  2. At the time of filling out the form, you might have to submit your AADHAAR number for credibility. This number serves as proof of your identity. Also, to make sure that there is no money laundering, the government has made it mandatory that the investors produce their PAN cards as proof for deposits above INR 50,000.
  3. As mentioned above, the tenure for the Kisan Vikas Patra scheme is 124 months. Although the tenure is long, it would be valuable for you to know that longer tenures result in bigger returns on investments.
  4. You can go for early withdrawal of the invested sum of money after two and a half years of deposit. But the withdrawal can only be undertaken in compliance with specific terms and conditions of the scheme.
  5. The Ministry of Finance can not just change Kisan Vikas Patra Interest Rates, but it can also alter the period of maturity based on market conditions.
  6. You can easily transfer your account from one post office to another. Not just that, it is also transferable among people. And there is no cap on how many times you can do it.
  7. Kisan Vikas Patra investment does not offer you tax deduction facilities under section 80C of the Income Tax Act.

Kisan Vikas Patra Interest Rates

Kisan Vikas Patra Interest Rates

The interest rate for this scheme might vary over different quarters in a year. The rates are decided on by the government of India. The rate of interest also varies depending on the tenure of the scheme selected at the time of purchase. Currently, the rate of interest is 6.9 %, before which it was 7.9 %. Since the returns are annually compounded, you get impressively higher returns on your investment.

Financial Year/Interest Rates2016-172017-182018-192019-202020-21
April-June7.8%7.6%7.3%7.7%6.9%
Maturity Period (Months)110113118112124
July-September7.8%7.5%7.3%7.6%
Maturity Period (Months)110115118113Not
Announced
October-December7.7%7.5%7.7%7.6%
Maturity Period (Months)112115112113Not
Announced
January-March7.7%7.3%7.7%7.6%
Maturity Period (Months)112118112113Not
Announced

Kisan Vikas Patra Eligibility: Who is eligible for this scheme?

  • Only citizens of India can apply for Kisan Vikas Patra.
  • For this scheme, the applicant must have completed the age of 18 years.
  • Although minors cannot purchase this scheme directly, an adult can make the purchase on the minor’s behalf.
  • If you belong to the NRI community or the Hindu Undivided Family (HUF), you are not eligible for this scheme.
  • Even trusts can purchase KVP certificates.

 Who should invest in this scheme?

This investment scheme is particularly appealing for people from rural India, especially those who do not own a bank account. However, anyone from anywhere can choose the scheme to grow their money. The best thing about the scheme is that it can be purchased for both adults and minors, singly or jointly. However, when you apply for a minor, it is important that you mention the date of birth of the minor as well as the parent’s or the guardian’s name in the application.

This scheme is just ideal for people who do not like to invest in high risk investment platforms. This is also perfect for you if you have surplus funds which you won’t need urgently. So, whether you choose this scheme or not will depend on your financial goals and your risk profile.

If, however, you are looking for tax saving benefits, then this might not be the best option for you.

What are the benefits of Kisan Vikas Patra scheme?

Kisan Vikas Patra Benefits and Features

One of the most important benefits of using this scheme is that you get guaranteed returns. That means, no matter how bad the market fluctuations are, your maturity corpus is guaranteed.

This mode of investment is extremely safe and is not hampered by any risks witnessed in the market. So, you get great capital protection, which is rare in high yielding investment schemes.

It is in denominations of INR 1,000, INR 5,000, INR 10,000 and INR 50,000 that this scheme is available for people. Another important benefit is that there is absolutely no higher cap for your investment. So you can invest as much money as you want. However, if you are looking to deposit denominations of INR 50,000, then you will have to do so only at your city’s head post office.

So, from the discussion above it is crystal clear that Kisan Vikas Patra is a beneficial scheme which you should consider investing in, if you want to double your money. Certain other benefits like KVP identity slip and nomination facility simply make the scheme all the more appealing for interested investors.

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