Kisan Vikas Patra (KVP)- Key Features, Benefits and Interest Rate in 2023


5 min read

Updated on Mar 20, 2023

When it comes to the popular and safe investment options that are commonly sought by people in India, the Kisan Vikas Patra (KVP) features among the best ones. Let’s understand the plan and its features in this post. 

The key benefit of investing in a Kisan Vikas Patra (KVP) is its attractive and high interest rates as compared to many other saving schemes in the country. With an interest rate of 7.2% applicable in the first quarter of 2023 (January-March), KVP is a lucrative investment scheme for the masses. Let us know the plan better.

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What is Kisan Vikas Patra (KVP)?

Kisan Vikas Patra (KVP) is a plan introduced by the India Post department of government of India in the year 1988. It was introduced as a savings certificate scheme which facilitates small savings among the masses of India over a long term at a good rate of interest. This scheme allows small savings to double at fixed rate of interest after a tenure of over 10 years.

The interested investor can purchase KVP certificates from a post office across India. Besides, these certificates are also available in several government banks.  KVP was initially started as an investment opportunity for the farmers in India. However, the plan is now open to all.

Here’s some details:

Kisan Vikas Patra Details
Rate of Interest 7.2 (Jan-Mar’2023)
Minimum Amount INR 1000
Maximum Amount No Limit
Maximum Tenure 124 months

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Kisan Vikas Patra (KVP) – Types of Certificates

KVP certificates are of three varied types, such as;

  • Single Holder Account – These certificates can be bought by the eligible individuals for their own selves or on behalf of a minor.
  • Joint ‘A’ Account –These certificates can be jointly held by two individuals in case both are eligible. The maturity amount in this case would be payable jointly to both the investors.
  • Joint ‘B’ Account – These certificates are again jointly owned by two eligible people. However, the maturity amount under this scheme is payable to one of the two joint account holders or survivor.

Kisan Vikas Patra (KVP) – Eligibility Criteria

  • The age of the applicant interested in investing in KVP scheme must be 18 years and above
  • He/she must be an Indian citizen
  • Parents/Guardians can purchase KVP certificates on behalf of minors or jointly hold accounts with minors
  • A trustee can purchase a KVP certificate
  • A limitation of KVP is that Hindu Undivided Family (HUF) as well as NRIs can’t invest under the scheme

Kisan Vikas Patra (KVP) – Interest Rate

The Union Government has announced the updated KVP Interest Rate for the financial-year 2022-23 on the 30th December, 2022. The KVP current interest rate is fixed at 7.2 % for Jan to Mar quarter of 2023.

The KVP investment is not influenced by the market risks and the interest rate of the scheme is reviewed every quarter, while it gets compounded on an annual basis.

Below is a chart with KVP interest rates of the current and previous years:

Quarter (Months) Current FY 2022-23 Previous FY 2021-22 Previous FY 2020-21 Previous FY 2019-20
April-June 6.9% (maturity 124 months) 6.9% (maturity 124 months) 6.9% (maturity 124 months) 7.7% (maturity 112 months)
July-September 6.9% (maturity 124 months) 6.9% (maturity 124 months) 6.9% (maturity 124 months) 7.6% (maturity 113 months)
October-December 6.9% (maturity 124 months) 6.9% (maturity 124 months) 6.9% (maturity 124 months) 7.6% (maturity 113 months)
January-March 7.2% (maturity 124 months) 6.9% (maturity 124 months) 6.9% (maturity 124 months) 7.6% (maturity 113 months)
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Kisan Vikas Patra (KVP) – Key Features and Benefits

  • Guaranteed Return – KVP is a government-backed scheme and thus guarantees an investor a high return on investment over a tenure of around 10 years. And the returns under this scheme is not affected by the market fluctuations.
  • Financial Security – Since the market risks do not affect your investment under the KVP scheme, it is regarded as one of the safest savings plans in the market offering high returns. Hence, investors availing the benefits of this plan can ensure financial security in the form of accumulated corpus at maturity.
  • Compounded Interest – The interest rate of KVP is compounded annually and thus it allows more returns on the sum.
  • Tenure of Investment – The maturity period of KVP at present is 124 months. The interest under this scheme continues to accumulate over the generated corpus and allow better returns over time.
  • TDS Exemption – Another benefit of KVP certificate is that no TDS (Tax Deducted at Source) is levied from the proceeds earned at maturity.
  • Loan Facility – KVP schemes allow loan facility to the investor. The KVP certificates can be used as security to avail a loan by the investor at a low interest rate.
  • Nomination Facility – The nomination facility of KVP is simple. Here, the subscriber requires to visit a post office, get a nomination form, duly fill and submit it. In case of minor nominee, the scheme holder must submit a copy of the birth certificate of the minor.

To Sum Up

KVP is a beneficial scheme for common risk-averse investors looking for safe investment options for their surplus funds with suitable returns. To know the KVP maturity amount, an investor can use a KVP interest calculator, which is easily available online. The investor is required to submit the deposit amount along with the tenure of investment to calculate the maturity amount using KVP calculator.

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FAQs on Kisan Vikas Patra

What is the least and highest amount that can be deposited under the Kisan Vikas Patra Scheme? 

Under the KVP scheme, an investor can deposit a minimum amount of INR 1000, while there is no maximum limit of investment.

Can I transfer my Kisan Vikas Patra Certificate to my nominee? 

Yes, the scheme allows investors to transfer the KVP Certificate to a nominee in the event of death of the account holder.

How frequently does the rate of interest of Kisan Vikas Patra change? 

The KVP interest is revised every quarter and is likely to change on a periodic basis. But the interest rate is calculated on an annual compounding basis.

Do KVP schemes allow premature withdrawal? 

Yes, an investor can close his/her KVP account prematurely only under three circumstances;

By a court’s order 
If the account holder dies, or
In case of forfeiture by a pledgee.

Does Kisan Vikas Patra offer any tax benefit?

No, KVP doesn’t allow any tax benefit and returns received under the plan are taxable. However, once the period of maturity is completed, the TDS is exempted from the amount withdrawn.

What is the rate of interest in the current financial year offered under KVP?

The KVP interest rate applicable in the first quarter of 2023 (January-March) is 7.2% and it was announced on December 30, 2022. 

What is the KVP maturity period?

The current maturity period of KVP is 10 years and 4 months. An individual can invest a minimum of INR 1000 under the scheme.

What is the Kisan Vikas Patra interest rate today?

The KVP interest rate in today’s time is 7.2 % for quarter Jan- Mar (FY 2022-23). 

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Jan 27, 2023
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