KVP Interest Rate

5paisa Research Team

Last Updated: 23 Nov, 2022 05:57 PM IST


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Kisan Vikas Patra is an extremely flexible investment scheme backed by the government of India. The savings scheme is available at all the post offices in India. When an individual invests in the KVP scheme, a certificate gets issued in their name. The KVP interest rate is quite high, and investors can expect substantial returns on completion of the maturity period. 

The scheme was originally launched by the Indian government in 1988. But the scheme was revised in 2014. Even though this scheme was primarily targeted at rural and semi-urban investors, urban investors with low to average incomes can also benefit from the scheme. Besides the high Kisan Vikas Patra interest rate, the popularity of the scheme also rises from its low-risk nature. 

KVP plans are available in three varieties. By using a KVP calculator, you will be able to realize the interest rate remains the same for all three types. But the number of people who can invest in the policy differs across the variations. The different variations are as follows:

●    Single-holder: Issues to a single investor
●    Joint A: Issued to two investors, and the interest is payable to both
●    Joint B: These can be obtained by two investors jointly, but the interest is available for only one

If you look at the KVP interest rate chart 2022, you will realize that the interest is around 7%. Dive deep to figure out more details about the Kisan Vikas Patra certificate. 

KVP Interest Rates

Kisan Vikas Patra interest rate changes periodically according to the declarations of the Finance Ministry. In fact, the KVP interest rate might vary across the different quarters in one particular financial year. When you invest in a particular quarter, the interest rate at that time is applicable for the entire quarter. 

The applicable Kisan Vikas Patra interest rate also impacts the maturity tenure in a particular quarter. You can always use a KVP interest rate calculator to have an understanding of your maturity amount. Check the KVP interest rate 2021 22 and 2020 21 quarters in the table below:

Q1 FY 2021 22


Q2 FY 2021 22


Q3 FY 2021 22


Q4 FY 2021 22


Q1 FY 2020 21


Q2 FY 2020 21


Q3 FY 2020 21


Q4 FY 2020 21



Have a glance at the KVP interest rate chart for the 2020-21 quarters. 

Q1 FY 2019 20


Q2 FY 2019 20


Q3 FY 2019 20


Q4 FY 2019 20



The KVP interest rate 2021 22 went lower after the financial quarters of 2019 20. Apart from the post offices in India, KVP is also available at some other financial institutions other than the post offices. But the KVP interest rate in the post office is the same as all other financial institutions offering it. 


Interest Applicability on Premature Withdrawal of KVP

Within 30 months of investing in KVP, premature withdrawals are not supported. But after that period, premature withdrawals are possible only in the event of the owner’s death. Sometimes partial withdrawals are also allowed due to a court directive. In such situations, the KVP premature withdrawal interest rate does not depreciate. 


Benefits of KVP

Several investors are left wondering, “Kisan Vikas Patra double in how many months”. A one-time KVP investment usually doubles within an estimated tenure of 124 months. You can always use a KVP calculator to determine the amount that you will be getting after a tenure of 124 months. Now, let us focus on all the other benefits of the KVP investment scheme. 

●    Easy application: The procedure for applying for KVP certificates is simple and straightforward. An individual can apply for KVPs with a post office or any other financial institution. The KVP application forms are also available online. 

●    Flexible investment: KVP certificates from the post offices have values of Rs 1000, Rs 5000, Rs 10000 and Rs 50000. While the minimum investment amount is Rs 1000, there is no upper limit on KVP investments. Due to the high investment amount with a combination of the available certificates, investors can expect a substantial KVP interest rate.

●    Capital protection: KVP certifications are one of the safest investment instruments. Since it is not subjected to market risks, you will get the investment with the accrued interest at the end of the tenure. 

●    Easy transfer: KVP is one of the most popular investment options due to its ease of transfer. You can easily transfer KVP certificates from one owner to another as well as from one post office to another.

●    Fixed returns: According to government regulations, the returns from KVP certificates are fixed. Sometimes the Finance Ministry changes the prevailing rate of interest. But still, investors enjoy assured returns. Even if the tenure changes, there won’t be any increase or decrease in the Kisan Vikas Patra interest rate.

●    Availability of premature withdrawal: Partial withdrawals are allowed after 2 years and 6 months from the date of investment. You also don’t have to bear any penalty charge for premature withdrawals.

●    Loan facility: your KVP certificates serve as collateral for loans from particular financial institutions. Since the risks are low for lenders with these certificates as collateral, you will be able to easily obtain secured loans at affordable interest rates. 

●    Tax benefits: If you use a KVP calculator, you will understand that the returns from the investments are substantial. Therefore, the government of India does not offer any tax benefits on these financial instruments. However, TDS is not deducted from the interest.

●    Nomination facility: You can also keep a nominee for your KVP investment. You will have to collect and fill up the nomination application form from the post office. You must mention the date of birth when you are nominating a minor. 

●    Additional interest rate after maturity: If you don’t withdraw the money after the completion of the maturity period, you will be able to receive additional interest on your invested amount. The additional interest rate isn’t as high as the normal KVP interest rate. However, it is the same as that of a normal savings account at the post office. 

Eligibility Criteria and Document Requirements for KVP

Once you are aware of the KVP interest rate, you also need to understand the eligibility criteria for investing in the Kisan Vikas Patra scheme:

●    The KVP applicant must be a legal citizen of India.
●    In the case of a minor, a guardian or person can make the investment.
●    A parent or guardian is also necessary for a KVP certificate for any individual with an unsound mind.
●    NRIs are not permitted to invest in the Kisan Vikas Patra scheme.
●    Hindu Undivided Families (HUFs) are not eligible to invest in a KVP certificate. 

The documents required by investors to get a KVP certificate are as follows:

●    Identify proof like an Aadhaar card, Voter ID, PAN card, Passport, or Driving License for the KYC procedure
●    Residence proof
●    Date of birth certification
●    Kisan Vikas Patra application form

Application Process for KVP

Once you have checked the KVP interest rate and have decided to invest in it, you need to do the following:

●    Collect the KVP application form and fill it with accurate details. 
●    Submit all the required documents along with the application form.
●    After submitting the application and the documents, you need to pay the amount that you desire to invest.
●    Once you have paid the investment amount, the KVP certification will be issued. When the concerned financial institution does not have an adequate number of certificates, you will be given a receipt. You can exchange the receipts later for the KVP certificates. 

Investors must keep the KVP certificates in a safe place. The certification is necessary while withdrawing the amount at the time of maturity. The KVP Identity Slip includes the KVP certificate, serial number, maturity date, invested amount, and the amount that you will receive upon maturity. 

How to Transfer KVP From One Person to Another

Investors are allowed to transfer KVP certificates from one post office to another with ease. You must complete the KVP transfer form to begin the transfer. You are also needed to submit the required documents at the post office. Click here to download the transfer form. 

KVP certificates can also be transferred from one individual to another. But the consent of the issuing post office or financial institution is necessary for the transfer. Moreover, the KVP certificates can only be transferred to the following individuals:

●    Heir of the deceased original owner
●    To the court of law from the KVP certificate holder
●    To a person legally mentioned by the court
●    To joint holders from a single holder
●    To another person from single or joint holders
●    To one joint holder from two joint holders

Taxability of Kisan Vikas Patra

For taxpayers following the “cash basis” of accounting, the KVP interest rate is taxed in the maturity year or premature encashment year. The tax payable depends on the applicable slab rates of that particular financial year. 

But for taxpayers following the “actual basis” of accounting, the Kisan Vikas Patra interest rate for each year is calculated on the basis of the applicable interest rate. The taxable amount depends on the applicable slab rates of the respective years. 

As per section 80C of the Income Tax Act, no tax benefits are available on KVP. But the Kisan Vikas Patra interest rate is not subject to TDS.   

Kisan Vikas Patra vs Fixed Deposits

Fixed deposits are a popular financial instrument regularized by NBFCs and banks. FDs offer higher interest rates than normal savings accounts. Let us discuss some of the differences between the two investment options.


Kisan Vikas Patra

Fixed Deposit

Interest rate

6.9% per annum

Varies according to the bank


Rs 1000 minimum investment and no limit on the maximum investment amount

A minimum investment of Rs 500 is necessary, while there is no limit on the maximum investment amount

Lock-in period

2 and a half years

No lock-in period


10 years and 3 months

10 years

Premature withdrawals

Withdrawals are allowed before maturity on special conditions

Withdrawals are allowed after 7 days of the investment

Tax benefits

No tax benefits are available

Tax saving FDs have exemptions of up to Rs 1.5 lakh


Kisan Vikas Patra vs NSC

The National Savings Certificate is also backed by the Indian government. It is an ideal financial instrument for small savings with income tax deductions. Take a glance at the major differences between the Kisan Vikas Patra and the NSC.


Kisan Vikas Patra

National Savings Certificate

Interest rate

6.9% per annum

6.8% per annum


A minimum of Rs 1000

No maximum limit

From Rs 100 to Rs 1,50,000

Lock-in period

2 and a half years

5 or 10 years


You can take housing loans and more against it

You can take housing loans and more against it

Premature withdrawals

Withdrawals are allowed before maturity on special conditions

Withdrawals before maturity are difficult and strict

Tax benefits

No tax benefits are available

Tax benefits are available


Who Should Consider Investing in KVP?

Any individual with disposable money of a minimum of Rs 1000 can invest in the Kisan Vikas Patra. The KVP interest rate for senior citizens and all other investors are quite high, and you can expect high returns. Therefore, it is one of the best savings options for individuals who are looking for risk-averse investments. 

Any individual above 18 years can go to their nearest post office to invest in the Kisan Vikas Patra scheme. The rural population of India with no bank accounts find KVP certificates the most appealing. People who are looking for investment options for minors or want to jointly save with another adult can also invest in the Kisan Vikas Patra scheme. 

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