Kisan Vikas Patra - KVP

Kisan Vikas Patra (KVP) 

It is one of the post office saving schemes. In this savings scheme, along with good interest rate, government guarantee of investment protection is also available.
One can earn good interest by investing in this savings scheme. The scheme is currently offering 6.9% interest. The money invested at this rate of interest doubles in 124 months.

Kisan Vikas Patra
Image Source : Indian Post

Types of accounts that can be opened under the Scheme

Single Holder Type Account

A Single Holder Type Account may be opened by an adult for himself, or on behalf of a minor or a person of unsound mind of whom he is the guardian, or by a minor who has attained the age of ten years

Joint A -Type Account

Joint A-Type Account may be opened jointly in the names of up to three adults payable to all the account holders jointly or to the survivors

Key Features

  1. Minimum Amount of Investment : 1000 Rs
  2. Maximum Amount of Investment : No limit
  3. Tenure of investment                     : 124 months (at 6.9% interest rate) as the interest rate varies the tenure will vary and it will be calculated, how many months will that interest rate take to double the money
  4. An individual can open any number of accounts
  5. Premature withdrawal will not be allowed until the death of the account holder or all the account holder in case of joint account
Example 

If a person invest Rs. 1,00,000/- today then after 124 months (10 years and 4 months) he will receive Rs. 2,00,000.

Drawbacks
  1. The Interest earned on the KVP (i.e Rs. 1,00,000/- in above case) is taxable under head Income from Other Sources
  2. To long lock in period 
  3. No deduction under section 80C of income tax 
Anybody who wants to earn more than bank FD's then he can go for the KVP option, otherwise National saving Certificate is best option to invest rather than KVP.
  

Comments

Post a Comment

Popular posts from this blog

Wipro Share Returns In Last 40 years

Exxaro tiles IPO Vs Windlas Biotech IPO Vs Krsnaa Diagnostics IPO Vs Devyani International IPO: GMP: Subscription till 6th August

Post Office Investments for Small and Safe Investors In India

Paras Defence And Space Technologies Limited IPO Details, GMP, Allotment Status and Issue Price

What is Investment ?

Best Ways To Save Money

Pradhan Mantri Vaya Vandana Yojana