Kisan Vikas Patra Scheme – Benefits, Features, Returns, Interest Rate, Taxation

  • Post category:Stock Market
  • Reading time:10 mins read
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  • Post last modified:March 26, 2024

Kisan Vikas Patra Scheme Details:

Kisan Vikas Patra is a small saving scheme regulated and administered by the Government of India through the Department of Posts.

The money you invest in Kisan Vikas Patra gets doubled upon maturity and the maturity period as of now from 01 January, 2024 is 9 years 7 months (115 months) and the current rate of interest for the KVP scheme is 7.5% per annum compounded annually.

The name of the scheme may confuse you as you may think it is for farmers in Hindi Kisan but in reality it has nothing to do with being Kisan.

The minimum amount that can be invested is Rs.1000 and there are no maximum limits, moreover the amount can be withdrawan once the scheme complete atleast 2.5 years in case of some emergency.

The KVP scheme comes with pledging facility which means you can pledge your KVP certificates as collateral instead of liquidating the fund you can get a loan directly from the bank just by pledging.

There is no deduction available for investing in this scheme. Tax Deduction at Source (TDS) is not applicable on the maturity proceeds of this scheme.

The interest income from this scheme is taxable as “Income from Other Sources” every year. You can choose to calculate and pay tax on the interest income every year on an accrual basis.

Another option is to pay the tax on the consolidated interest income you receive at the end of the five years.

  1. Minimum amount you can invest is ₹ 1000/- where as there is no upper limit to invest.
  2. The current maturity period from 01 January 2024 for KVP scheme is 9 years 7 months (115 months).
  3. The current rate of interest from 01 January 2024 for KVP scheme is 7.5% p.a. compounded annually.
  4. KVP can be encashed (Premature withdrawal) after 2 and half years from the date of investment.
  5. Account can be opened in Post offices and in authorised banks.


How Much Will I Get Investing In Kisan Vikas Patra Scheme ?

Returns from KVP scheme are guaranteed and the current rate of interest for KVP scheme is 7.5% p.a. compounded annually however it totally depends on the amount you are investing so suppose you decided to invest Rs. 5 lacs in the KVP scheme for 9 years 7 months.

Checkout the below image taken from moneycontain Kisan Vikas Patra calculator:


Kisan Vikas Patra Scheme



Total Investment Amount in KVP = Rs. 500000

Expected Return% (ROI) = Current 7.5% p.a.

Current Maturity Period = 115 months (9 years & 7​​​ months)

KVP Total Maturity Amount (Principal + Interest) = ₹9,99,926

Total Interest Earned On Investment Made = ₹4,99,926

Yo can check your returns easily using moneycontain Kisan Vikas Patra Calculator.


Kisan Vikas Patra Scheme Interest Rates Since Inception:

23-09-2014 to 31-03-2016
8.7(100 Months)
1.4.2016 to 30.9.2016
7.8 (110 Months)
1.10.2016 to 31.3.2017
7.7 (112 Months)
1.4.2017 to 30.6.2017
7.6 (113 Months)
1.7.2017 to 31.12.2017
7.5 (115 Months)
1.1.2018 to 30.9.2018
7.3 (118 Months)
1.10.2018 to 30.6.2019
7.7 (112 Months)
1.07.2019 to 31.03.2020
7.6 (113 Months)
1.4.2020 to 31.03.2023
7.2(124 Months)
From 01.01.2024
7.5(115 Months)


Where and How to open a Kisan Vikas Patra Account?

The following types of accounts can be opened under the Scheme, namely :-

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 upto three adults payable to all the account holders jointly or to the survivors;

Joint B- Type Account – Joint B-Type Account may be opened jointly in the name of upto three adults payable to any of the account holders or to the survivor or survivors.

Account can be opened in Post offices and in authorised banks, make sure to keep your documents such as pancard, Aadhar card, driving license, passport size photograph handy.

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Is Pledging Allowed Under Kisan Vikas Patra Scheme ?

KVP certificates may be pledged or transferred as security, by submitting prescribed application form at concerned Post Office supported with acceptance letter from the pledgee. Transfer/pledging can be made to the following authorities.

  • The President of India/Governor of the State.
  • RBI/Scheduled Bank/Co-operative Society/Co-operative Bank.
  • Corporation (public/private)/Govt. Company/Local Authority.
  • Housing finance company.


Is Premature Closing Available For Kisan Vikas Patra Scheme ?

Yes, KVP Scheme may be prematurely closed any time before maturity subject to the following conditions : –

  1. On the death of a single account, or any or all the account holders in a joint account.
  2. On forfeiture by a pledgee being a Gazette officer.
  3. When order by court.
  4. After 2 years and 6 months from the date of deposit.


Is It Possible to transfer KVP Account?

Yes, KVP may be transferred from one person to another person on the following conditions only.

  • On the death of account holder to nominee/legal heirs.
  •  On the death of account holder to joint holder(s).
  • On order by the court.
  • On pledging of account to the specified authority.

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Doing an investment with less risk may give less returns but what is most important is the peace of mind. Moreover, the returned from Kisan Vikas Patra Yojana are guaranteed and backed by the government of India.

The interest rate may again go high in future for KVP scheme depending upon the prevailing situation in economy which currently is facing global crisis including India.

In my opinion instead of investing all your money in Fixed deposits or stock market investing in KVP Scheme can provide you the diversification required.

If you are looking to make investment in other government backed schemes take a look at below calculators.

Post Office Monthly Income Scheme Calculator 

PPF Calculator With Extension

NPS Calculator – National Pension Scheme Calculator

Post Office NSC Calculator

Sukanya Samriddhi Yojana Calculator

Post Office RD Calculator

Also do checkout the impact of inflation on your returns as well as your life using moneycontain inflation rate calculator and calculate your future expenses easily.

You can also check Moneycontain Monthly SIP Calculator with inflation to know how much need to invest today to reach your future financial targets.

In case you are looking to buy a home than please check this ultimate guide on home loan and Moneycontain home Loan EMI calculator. It calculates your EMI’s as well as Interest amount and lot more.

If you want to explore the stock market and how does it work step by step than check moneycontain Free share market guide specially designed for beginners.

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If, you have liked the content please do share it with your friends or on social media, as sharing do bring the good karma. If you have any questions or feedback you can leave them in comment box below.

Note: Please do not take this as any recommendation, to trade or invest. This is just for reference, to make you understand more about the usage of Kisan Vikas Patra Scheme and its importance, under no circumstances intended to be used or considered as financial or investment advice, a recommendation or an offer to sell, or a solicitation of any offer to buy any securities or other form of financial asset.

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