All about Kisan Vikas Patra (KVP): time for doubling, rules etc explained
Kisan Vikas Patra is one of the most popular saving
schemes of India Post. India Post introduced Kisan Vikas Patra (KVP) as a small
saving certificate scheme in 1988. Its primary objective is to encourage
long-term financial discipline in people particularly from rural area. The
tenure for the scheme is now 118 months (9 years & 10 months). The minimum
investment is Rs. 1000 and there is no upper limit. PAN Card is now compulsory
for investments above Rs. 50,000. Aadhar is mandatory as identity proof. For
deposit of Rs. 10 lakhs or more, depositor must submit income proofs (salary
slips, bank statement, ITR document etc.). Kisan Vikas Patra is a “no risk instrument” as it is backed by
Govt. of India.
You can buy Post Office KVP in denominations of Rs
1000. There is no upper limit on the amount that you can invest in KVP,
however, it cannot be less than Rs 1000. Current interest rate for KVP is 7.6%
which mean the doubling period for KVP is 113 months. In other words, the value
of your investment in KVP will double in 9 years and 5 months.
How to invest in KVP
Kisan Vikas Patra (KVP) can be made in cash, local
cheque, pay order or demand draft drawn in favour of the Postmaster. It can
also be done by presenting a duly signed withdrawal form or cheque together
with the passbook
Premature Withdrawal
Premature encashment of KVP is possible after 2.5
years under the following circumstances:
– In case of death of the certificate holder, or of
any of the holders in case of joint holders.
– Forfeiture by a pledgee being Gazetted Government
Officer,
– On order by a court of law.
Taxation
Kisan Vikas Patra (KVP) investments don’t come under
the 80C deductions and the returns are also taxable. However, Tax Deducted at
Source (TDS) is exempt from withdrawals after the maturity period.
Loan against KVP certificate
You can use your KVP certificate as collateral or
security to avail secured loans.
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