Government Re-launches Kisan Vikas Patra
Government launched Kisan Vikas Patra (KVP) again. Kisan Vikas Patra is a saving scheme introduced by Government of India to encourage small savings by people. It was a popular saving scheme once in India which was discontinued in 2011. But, due to the fact that the country’s small savings are found to be less and in order to promote savings, the scheme was re-launched by the government of India.
Kisan Vikas Patra are sold in post offices. There is a minimum lock-in period of two and a half years from the date of issue for these certificates. The maturity period is 100 months or 8 years and four months. The interest rate on these certificates is at par with that of PPF with 8.70% per annum. However, no tax benefit is available to certificate holders unlike in PPF. The only tax benefit on these certificates is that there is no wealth tax on them.
The interest rate is fixed, and hence an assured benefit of doubling the amount within the stipulated time. These certificates are issued by government and are thus secure. These certificates are available in denominations of Rs.100, Rs.500, Rs.1000, Rs.5000 and Rs.10000. There is no upper limit for owning these certificates. The main benefit lying with these certificates are their ease of use. KVP are physical instruments and there are no Demat forms for them.
Anyone can invest in these certificates for themselves or on behalf of a minor. These can bought on single or jointly. The certificates can be transferred from one post office to another, and from one person to another person under certain circumstances. Furthermore, KVP can be used as collaterals against several loans.