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Kisan Vikas Patra (KVP) – Eligibility, Features, Interest Rates & Returns

Kisan Vikas Patra (KVP) – Eligibility, Features, Interest Rates & Returns

Kisan Vikas Patra (KVP) is a savings scheme offered by the Indian government to encourage people to save money for the long term. The scheme is aimed at helping small farmers and rural communities to build wealth and secure their financial future. In this article, we will explore the various aspects of KVP, including its meaning, eligibility criteria, benefits, tax implications, and more.

What is the meaning of Kisan Vikas Patra?

Kisan Vikas Patra refers to a savings certificate offered by the Indian government to help individuals save money for their future. The certificate is like a savings account and can be purchased from any post office or authorized bank. The name “Kisan Vikas Patra” literally means “farmer development certificate” in Hindi, reflecting the government’s aim of providing financial support to farmers and rural communities.

Who is eligible for Kisan Vikas Patra?

Anyone can purchase a KVP certificate, regardless of their profession or income level. There are no restrictions on age or income, so it is a savings option that is accessible to a wide range of people. It is also worth noting that KVP certificates can be purchased by individuals, joint holders, minors (with a guardian), or Hindu Undivided Families (HUFs).

Which is best KVP or FD?

This question is a matter of personal preference, as both KVP and Fixed Deposits (FDs) have their own advantages and disadvantages. FDs are generally considered to be a more secure investment option, as they offer guaranteed returns. However, KVP certificates offer a higher interest rate than most FDs and have a shorter maturity period. Ultimately, the choice between KVP and FD will depend on an individual’s investment goals, risk tolerance, and financial circumstances.

What is the benefit of KVP?

There are several benefits to investing in KVP certificates, including:

  • Higher interest rate compared to savings accounts or other fixed deposits
  • Short-term investment option with relatively low risk
  • Easy to purchase and manage, as certificates can be purchased from post offices and authorized banks
  • Interest earned on KVP certificates is exempt from tax, making it a tax-efficient investment option
  • Certificates can be easily transferred from one person to another, making it a versatile investment option

Is KVP maturity amount tax-free?

Yes, the maturity amount received from a KVP certificate is tax-free and exempt from income tax. This makes KVP an attractive investment option for those looking to save money for the long term, as the entire maturity amount can be reinvested or used for other purposes without having to pay any taxes.

In which bank is KVP available?

KVP certificates can be purchased from any post office or authorized bank in India. Most major public and private sector banks, such as State Bank of India, Bank of Baroda, HDFC Bank, and ICICI Bank, offer KVP certificates.

What is the interest rate on KVP?

The interest rate on KVP certificates is determined by the Indian government and may change from time to time. As of my knowledge cut-off (2021), the current interest rate on KVP certificates is 6.9% per annum, payable semi-annually.


In conclusion, the Kisan Vikas Patra (KVP) is a savings scheme that has been designed to help farmers and rural populations in India to grow their savings and achieve financial stability. Despite its long history and widespread popularity, the KVP has faced criticism and questions about its effectiveness and sustainability. While the KVP may have served a valuable purpose in the past, it is unclear what the future holds for this scheme. In light of the changing economic landscape and the growing need for more innovative and effective financial products, the RBI and the Indian government may need to reassess the role of the KVP and consider alternative solutions. Regardless of its future, the KVP remains an important piece of India’s financial history and a testament to the government’s efforts to support rural populations. As the country continues to evolve and grow, it will be important to consider the needs of farmers and rural populations and ensure that they have access to the financial tools and resources they need to thrive.