InvestorQ : How is the Kisan Vikas Patra(KVP) from the post office Banks?
Abigail Ghoshal made post

How is the Kisan Vikas Patra(KVP) from the post office Banks?

Sakshi Malhotra answered.
2 years ago
Kisan Vikas Patra is a small savings scheme certificate introduced by India post. The tenure of this scheme is 10 years and 4 months if it is purchased between 1 April 2020 to 30 June 2020. The minimum investment under the scheme is Rs 1,000 and there’s no bar on maximum investment. Under this scheme, if you invest a lumpsum amount today you can get the double amount at the end of the 124th month. This scheme is available for all. 

Under the scheme, there are three certificates available: Single Holder Type, Joint ‘A’ Type, and Joint ‘B’ Type

Advantages of KVP:

  • Even when there will be fluctuations in the market, you will get guaranteed returns.
  • The risk involved is very low or NIL as there is no market risk involved.
  • The effective interest rate under the scheme varies depending on the number of years invested. The current interest rate offered by KVP is 6.9%.
  • You can earn interest on maturity proceeds until one withdraws the amount.
  • You can use your KVP as collateral for getting secured loans as interest rates for secured loans is comparatively low.
As far as the disadvantages of the said scheme are considered, we don’t see that it has many drawbacks. So, if you are looking for a risk-free investment option that can help you develop long-term investment discipline and getting better returns than fixed deposits and other such options, this can be the right choice. However, it is always suggested that before making any investment first make sure that you know what are your investment objectives and then choose the right option for you.