Posted 04 Aug 2017 01:44 PM

Kisan Vikas Patra is a savings scheme which was introduced by India Post in 1988. It was a successful scheme at its launch but later on, a committee was set under Shayamla Gopinath which gave recommendations to the Govt that the scheme can be misemployed. Thereafter the Govt decided to put the scheme to an end in 2011 and it was revived in 2014. Kisan Vikas Patra can be availed by any individual in his own name, or on behalf of a minor, trust or by two people together.
The Government decided to lower the interest rates on small saving schemes like Kisan Vikas Patra, PPF and Sukanya Samridhhi scheme by 0.1 percent for the April-June period. This move will encourage the banks to cut their deposit rates. Whereas interest on savings account has been retained to 4% annually.
Kisan Vikas Patra will give a return of 7.6 percent and the maturity period will be of 112 months. PAN card is essential to make investments over Rs 50,000 and salary statement for investments beyond Rs 10 lakh. KVP is easily available in all the post offices across India. Twice the amount will be given to the investor on his principal amount after 8 years and 4 months or 100 months. The prime audience for KVP are the people from rural and semi urban area. Earlier it was available at an attractive rate of interest 8.7% but not the interest rates have fallen from 8.7% to 7.8%.
Kisan Vikas Patra is available in multiple denominations that are feasible for the customers. The denomination starts from Rs 100 to Rs 50000. It is risk –free investment and its remains unaffected by inflation as the rate of interest will not change. A person can invest any amount as there is no cap on the amount. An individual can also avail loan on the KVP scheme from banks. Premature withdrawal is also available on the scheme after 2 years and six months and it can also be transferred to another person. Tax benefits can also be availed on this scheme whereas there will be no tax deduction for the entire amount received on maturity and no tax deduction at the source.

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