This government scheme offers higher interest rate than SBI FD, doubles the investment in 123 months
Under this scheme, you can make a minimum investment of Rs 1000 to purchase a KVP certificate. The amount is invested for a minimum of 123 months or 10 years and 3 months. Investments can be increased only by Rs 1000 and there is no upper investment limit, meaning you can invest as much as you want. For any investment above Rs 50,000 you need to produce your PAN details.
Kisan Vikas Patra: Key Features
Who can invest?
Any Indian citizen above the age of 18 can invest in this scheme and buy a certificate. There is no upper age limit for the scheme, hence senior citizens can also invest in the scheme. The scheme also allows minors to invest and purchase KVP certificate. But adults should keep the score. Minors can only invest if an adult buys the certificate on their behalf. Only Indians resident in India are eligible to purchase a KVP certificate. Non-Resident Indians are not allowed to invest in the KVP scheme. Apart from NRIs, Hindu-joined families cannot purchase a KVP certificate.
The scheme allows trusts to buy KVPs, but companies cannot buy a KVP certificate. A KVP certificate can be purchased from the nearest post office or from one of the selected banks that offer the certificate. This makes the scheme easy to access. If you have to move from the city where you bought the certificate, you can transfer the certificate from one post office to another. You can also choose to transfer your KVP certificate to someone else. The scheme allows you to nominate a family member who is entitled to withdraw the funds in the event of your death.
The scheme has a minimum lock-in period of 30 months or two and a half years. If the certificate holder decides to withdraw the funds two and a half years after purchasing the certificate, no penalty will be imposed. Interest accrued on funds is also given to the investor. Any collection before two-and-a-half years may attract penalty or interest reduction. Withdrawals within one year of purchase will incur a penalty and you will not be charged any interest. If you withdraw after one year but up to two and a half years, there is no penalty, but the interest you get will be reduced. Both the interest rate and the repayment period may vary depending on prevailing interest rates in the market.