Post Office Kisan Vikas Patra

The Post Office Kisan Vikas Patra (KVP) is a savings scheme for guaranteed returns. You invest a lump sum and it matures in about 9.5 years (115 months), doubling your money. KVP is a low-risk investment option for long-term savings with a minimum investment of Rs. 1,000.

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Disclaimer: #The investment risk in the portfolio is borne by the policyholder. Life insurance is available in this product. The maturity amount of Rs 1 Cr. is for a 30 year old healthy individual investing Rs 10,000/- per month for 30 years, with assumed rates of returns @ 8% p.a. that is not guaranteed and is not the upper or lower limits as the value of your policy depends on a number of factors including future investment performance. In Unit Linked Insurance Plans, the investment risk in the investment portfolio is borne by the policyholder and the returns are not guaranteed. Maturity Value: ₹1,05,02,174 @ CAGR 8%; ₹50,45,591 @ CAGR 4%. *Tax benefits and savings are subject to changes in tax laws. All plans listed here are of insurance companies’ funds.

What is the Post Office Kisan Vikas Patra Scheme?

The full form of KVP is Post Office Kisan Vikas Patra, which is a government-backed savings scheme designed to encourage long-term investment among the general public.

This best investment option is available at all the Post offices in India.
It is a secure and reliable means to double your invested amount over a predetermined period.
This is an investment plan which aims to encourage long-term financial planning and savings among the rural and urban population.
With attractive interest rates, ease of transfer, and no upper limit on investment, KVP is an ideal option for individuals seeking safe and guaranteed returns on their savings.

Features of Kisan Vikas Patra Post Office Scheme

Feature	Description
Type of Investment	Fixed-deposit certificate scheme
KVP Interest Rate	7.5% p.a. (compounded annually)
Term	115 months (around 9.5 years)
Returns	Doubles your investment on maturity (interest rates are fixed by the government)
Minimum Investment	Rs. 1,000 (in multiples of Rs. 100)
Maximum Investment	No upper limit on investment amount
Eligibility	Indian residents (including minors with a guardian)
Lock-in Period for Withdrawals	2.5 years (30 months)
Benefits	Low risk, secure investment with government backing, tax benefits (interest earned is taxable)

Types of Post Office Kisan Vikas Patra Accounts

There are three types of Kisan Vikas Patra (KVP) accounts offered by the India Post:

Single Holder Type Account: This account is issued to a single adult, or an adult on behalf of a minor or a person of unsound mind.
Joint A-Type Account: This account is issued jointly to a maximum of three adults. The maturity amount is payable to all the account holders jointly or to the survivors.
Joint B-Type Account: This account is also issued jointly to a maximum of three adults. The unique feature of this type is that the maturity amount is payable to any of the account holders or to the survivor(s).

Illustration of Kisan Vikas Patra Interest Rate

If you invest in a Kisan Vikas Patra (KVP) as per the following details, you can experience the doubling your investment feature of this investment option using a Kisan VIkas Patra Calculator or a Compound Interest Calculator:

Principal Amount Invested = ₹1.5 lakhs annually

Tenure = 115 months (9.5 years)

Current Interest Rate = 7.5% p.a.

Compounding Frequency = Yearly

If you calculate this investment using the Compound Interest Calculator:

Your Maturity Amount = ₹3.05 lakhs

Total Interest Earned = ₹1.55 lakhs = Doubles Your Investment in 115 months.

Eligibility Criteria to Apply for Post Office Kisan Vikas Patra

The eligibility criteria to apply for a Post Office Kisan Vikas Patra (KVP) are fairly simple:

Age: You must be at least 18 years old.
Citizenship: You must be a resident Indian citizen.
Minors: A minor cannot directly apply for KVP. However, an adult (above 18 years) can purchase KVP on behalf of a minor.
Joint KVP Account: Kisan Vikas Patra can be purchased singly or jointly by up to three adults.
EXCLUSION: Non-Resident Indians (NRIs) and Hindu Undivided Families (HUFs) are not eligible to invest in KVP.

NOTE: While the scheme was originally intended for farmers (as reflected in the name), it is now open to everyone who meets the above criteria.

Key Benefits of Post Office Kisan Vikas Patra

The Post Office Kisan Vikas Patra (KVP) offers you a number of benefits; some of them are listed below:

Guaranteed Returns: Kisan Vikas Patra (KVP) offers assured returns, ensuring your investment grows steadily over time. Unlike stock markets, the returns are not influenced by market volatility.
Doubling of Investment: The scheme is designed to double your investment in a predetermined period, making it a reliable option for long-term wealth creation.
Government Backing: Being a government-backed scheme, KVP is highly secure. This guarantees the safety of your principal amount and accrued interest.
Fixed Interest Rate: KVP offers a fixed interest rate, which remains constant throughout the investment tenure. This helps in planning your finances better, knowing the exact amount you will receive upon maturity.
Premature Withdrawal: While KVP has a lock-in period, it allows for premature withdrawal under certain conditions, offering flexibility in case of emergencies.
Nomination Facility: You can nominate a beneficiary at the time of purchase, ensuring that the invested amount is passed on to your loved ones without any hassle.
Transferable: KVP certificates can be transferred from one person to another, which is useful in case of gifting or transferring to a family member.
Tax Benefits: Though the interest earned on KVP is taxable, there are no Tax Deducted at Source (TDS) at the time of withdrawal, making it simpler for you to manage your tax liabilities.

Documents Required to Get a Post Office Kisan Vikas Patra

The key documents needed for a Kisan Vikas Patra (KVP) application are as follows:

Application Forms:
- Form A: This is the standard application form you'll need to submit for a KVP account.
- Form A1 (Optional): This form is only required if you're applying through an agent.
KYC Documents: These are for identity verification and comply with Know Your Customer (KYC) regulations. You can use any of the following:
- Aadhaar Card
- PAN Card
- Passport
- Voter's ID
- Driving License

Historic KVP Interest Rates in India

Financial Year (FY) / Period	April-June	July-September	October-December	January-March
2023-2024	7.5% (Maturity tenure is 115 months)	7.5% (Maturity tenure is 115 months)	7.5% (Maturity tenure is 115 months)	7.5% (Maturity tenure is 115 months)
2022-2023	6.9% (Maturity tenure is 124 months)	6.9% (Maturity tenure is 124 months)	7.0% (Maturity tenure is 122 months)	7.2% (Maturity tenure is 119 months)
2021-2022	6.9% (Maturity tenure is 124 months)	6.9% (Maturity tenure is 124 months)	6.9% (Maturity tenure is 124 months)	6.9% (Maturity tenure is 124 months)
2020-2021	6.9% (Maturity tenure is 124 months)	6.9% (Maturity tenure is 124 months)	6.9% (Maturity tenure is 124 months)	6.9% (Maturity tenure is 124 months)
2019-2020	7.7% (Maturity tenure is 112 months)	7.6% (Maturity tenure is 113 months)	7.6% (Maturity tenure is 113 months)	7.6% (Maturity tenure is 113 months)
2018-2019	7.3% (Maturity tenure is 118 months)	7.3% (Maturity tenure is 118 months)	7.7% (Maturity tenure is 112 months)	7.7% (Maturity tenure is 112 months)
2017-2018	7.6% (Maturity tenure is 113 months)	7.5% (Maturity tenure is 115 months)	7.5% (Maturity tenure is 115 months)	7.3% (Maturity tenure is 118 months)
2016-2017	7.8% (Maturity tenure is 110 months)	7.8% (Maturity tenure is 110 months)	7.7% (Maturity tenure is 112 months)	7.7% (Maturity tenure is 112 months)

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Steps to Get Post Office Kisan Vikas Patra

There are two ways to get a Kisan Vikas Patra (KVP): offline at a post office or online. Here's a breakdown of both methods:

Offline Process
- Visit your nearest post office and ask for Form A, which is the KVP application form.
- Fill out the form with your details, investment amount, type of KVP (single, joint "A", or joint "B"), and nomination details (optional but recommended).
- Submit the completed form along with a copy of a valid ID proof (Aadhaar card, PAN card, Voter ID, Driving License, or Passport) for KYC purposes.
- Make the investment in cash, pay order, locally cleared cheque, or demand draft drawn in favor of the Postmaster.
Online Process
- Go to the India Post website or log in to your internet banking portal (if it offers KVP purchases).
- Download the KVP Form A.
- Fill out the form with your information, investment amount, preferred mode of payment, and type of KVP. Include nomination details if desired.
- Print the form and submit it to your nearest post office along with your KYC documents and the investment amount.

How to Make Premature Withdrawals from KVP Scheme?

Kisan Vikas Patra (KVP) discourages premature withdrawals by imposing penalties or reduced interest rates. There is a lock-in period of 30 months (2.5 years) after which you can encash the certificate without penalty.

Scenario

Details

Before 30 Months (2.5 Years)

Premature encashment is generally not allowed unless due to the account holder's death or a court order.

After 30 Months (2.5 Years)

Withdrawal Process:

-Visit the post office where you purchased the KVP certificate.
-You will receive the principal amount along with interest.

Interest Rate: The interest rate will be the prevailing rate applicable at the time of investment.

How to Nominate in KVP Scheme?

There are two ways to nominate someone for your Kisan Vikas Patra (KVP) account:

During purchase: You can nominate someone while filling out the application form (Form A) for KVP. This form will have a section dedicated to nomination details where you can specify the name and address of the nominee.
After purchase: If you did not nominate anyone while buying the KVP, you can still do it anytime before the maturity period. To do this, you need to submit Form C, duly filled out, to the post office or bank where your KVP certificate is held. Form C is specifically for nomination/variation/cancellation for KVP.

How to Encash Your Kisan Vikas Patra Post Office Account

Visit the Post Office: Go to the relevant post office with your KVP certificate and ID slip.
Premature Encashment: If encashing before maturity, write a request letter explaining the reason (optional).
Form Submission (if applicable): In some cases, you might need to fill out a form provided by the post office.
Verification and Payment: The post office will verify your documents and calculate the payable amount based on maturity or premature encashment rules.
Receive Payment: Upon verification, you will receive the encashment amount.

How to Transfer Your KVP Account?

Transferring a Kisan Vikas Patra (KVP) account depends on the reason for the transfer. Some of the common scenarios are mentioned below:

Transferring a deceased person's KVP:
- The KVP can be transferred to the legal heir(s) or the nominee, if nominated.
- Required documents: Death certificate, succession certificate, or probate.
Transferring KVP due to court order:
- The account can be transferred based on a court order.
- Required documents: Court order specifying the transfer details.
Transferring between joint holders:
- In a joint account, if one holder dies, the account gets transferred to the surviving holder(s).
- You might need a fresh application form signed by the surviving holder(s).
Transferring from single holder to joint holders (or vice-versa):
- This is possible with the authorized postmaster or bank officer's consent.
- Required documents: Application form and KYC documents of all holders.
Transferring KVP from one post office to another:
- This can be done through a form at either of the post offices.
- Both holders (if joint) need to be present for a joint account.

In Conclusion

The Post Office Kisan Vikas Patra (KVP) is a secure and reliable investment scheme designed for individuals seeking to double their savings in a predetermined period. This investment option offers assured returns, and is ideal for risk-averse investors looking for a long-term, government-backed saving instrument. Its simplicity, accessibility through post offices, and guaranteed returns make it an attractive option for building a secure financial future.

Frequently Asked Questions

What is the interest rate for Kisan Vikas Patra?

The current interest rate for Kisan Vikas Patra is 7.5% per annum, which is compounded annually.
Which is better, PPF or KVP?
Both Public Provident Fund (PPF) and KVP are government-backed savings schemes, but they have some key differences:
- Investment tenure: KVP has a fixed tenure of 113 months (9 years and 5 months), while PPF has a tenure of 15 years with an option to extend in blocks of 5 years.
- Interest rate: The current interest rate for KVP is 7.5%, while the interest rate for PPF is variable but generally higher than KVP.
- Liquidity: KVP offers lower liquidity compared to PPF. You can make partial withdrawals from PPF after 5 years, while KVP does not allow withdrawals before maturity.
Which is better KVP or NSC?
Both the schemes are good depending on your financial goals:
- Tenure: KVP has a tenure of 113 months, while NSC offers various tenure options ranging from 5 to 10 years.
- Interest rate: The interest rate for KVP is currently 7.5%. NSC interest rates are variable but can be slightly lower than KVP.
- Interest payout: KVP interest is compounded annually, while NSC offers interest payout options like monthly, quarterly, or reinvestment.
What is the interest rate of KVP in the post office calculator?

The post office calculator displays the current interest rate for KVP, which is 7.5% from 01 January, 2024. If you are unsure, you should check the online post office website to confirm the rate.
What is Kisan Vikas Patra?

Kisan Vikas Patra (KVP) is a small savings scheme offered by India Post. It encourages long-term savings with attractive interest rates and maturity benefits.
Who can invest in KVP?

Anyone can invest in KVP, regardless of profession. While initially aimed at farmers (Kisan means farmer), it is now open to all.
What is the minimum investment amount?

The minimum investment for KVP is Rs. 1,000. You can invest in multiples of Rs. 100 with no upper limit. However, certificates come in denominations of Rs. 1,000, Rs. 5,000, Rs. 10,000, and Rs. 50,000 (available only at head post offices).
What is the current interest rate and maturity period?

Interest rates are revised quarterly. As of June 2024, the rate is 7.5% and the maturity period is 115 months (approximately 9 years and 5 months).
Can I prematurely encash KVP?

Early encashment is allowed in KVP Post Office Scheme, but you will receive a lower interest rate, typically the prevailing Post Office Savings Account (POSA) rate.
How can I nominate someone for KVP?

You can nominate a beneficiary during purchase (Form C) or later by submitting a completed Form C to the issuing post office.
Can I get a loan against KVP?

Yes, some banks offer loans against KVP with limitations on loan amount and purpose. Check with your bank for details.
What happens if I lose my KVP certificate?

You can apply for a duplicate certificate at the issuing post office by submitting a written request and, if possible, the identity slip provided at purchase.
Where can I invest in KVP?

You can invest in KVP at any post office in India.
Are there any tax benefits on KVP?

The interest earned on KVP is taxable as per your income tax slab.

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Past 10 Years' annualised returns as on 01-12-2024

^The tax benefits under Section 80C allow a deduction of up to ₹1.5 lakhs from the taxable income per year and 10(10D) tax benefits are for investments made up to ₹2.5 Lakhs/ year for policies bought after 1 Feb 2021. Tax benefits and savings are subject to changes in tax laws.

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^^The information relating to mutual funds presented in this article is for educational purpose only and is not meant for sale. Investment is subject to market risks and the risk is borne by the investor. Please consult your financial advisor before planning your investments.

#The investment risk in the portfolio is borne by the policyholder. Life insurance is available in this product. The maturity amount of Rs 1 Cr. is for a 30 year old healthy individual investing Rs 10,000/- per month for 30 years, with assumed rates of returns @ 8% p.a. that is not guaranteed and is not the upper or lower limits as the value of your policy depends on a number of factors including future investment performance. In Unit Linked Insurance Plans, the investment risk in the investment portfolio is borne by the policyholder and the returns are not guaranteed. Maturity Value: ₹1,05,02,174 @ CARG 8%; ₹50,45,591 @ CAGR 4%

¶Long-term capital gains (LTCG) tax (12.5%) is exempted on annual premiums up to 2.5 lacs.

**Returns are based on past 10 years’ fund performance data (Fund Data Source: Value Research).