Top Reasons Why Kisan Vikas Patra is the Ideal Investment Option

Investing is a key component of financial planning, and choosing the right investment tool can significantly enhance your financial growth prospects. One such reliable and beneficial investment option that Indians can consider is the Kisan Vikas Patra (KVP) scheme. Introduced by the Government of India, Kisan Vikas Patra is among India’s popular and widely accepted small saving schemes.

Primarily offered by the Indian Postal Services, the Kisan Vikas Patra scheme provides its users with a fantastic combination of safety, good returns and low risk. If you are considering saving schemes that promise maturities with almost minimal risk, KVP could be a front-runner.

  1. Guaranteed Returns: The critical advantage of investing in Kisan Vikas Patra is the fixed and guaranteed returns it offers. Unlike some other investment options, your returns here are not impacted by market fluctuations. Currently, the KVP interest rate is 6.9% compounded annually, and the scheme guarantees to double the investor’s money in 124 months (about 10.33 years).
  2. Flexibility: You can invest in Kisan Vikas Patra starting with a minimal investment of Rs. 1000, and there is no upper limit on the investment amount. This wide range of investment options makes it an excellent fit for both high and low budget investors.
  3. High levels of Security: KVP is a government-backed scheme, making it one of the most secure investment options in India. The fact that this scheme is issued by the Department of Post, Government of India ensures that the principal amount, as well as the returns, are safe and secure.
  4. Ease of Purchase and Transfer: Kisan Vikas Patra can be bought from any Department of Post office in India. Furthermore, it can be transferred from one person to another, making it an easily transferable investment.
  5. Nomination Facility: Kisan Vikas Patra provides its subscribers with the option to nominate a person. In the event of the investor’s death, the chosen nominee will receive the benefits of the scheme.
  6. Tax Benefits: The investor doesn’t need to pay tax at source on the returns gained from Kisan Vikas Patra. However, the investment in KVP and the returns are liable to tax under the Income Tax Act, 1961. As such, the overall tax benefits may be lesser compared to other investment options.

Nevertheless, like any other investment options, Kisan Vikas Patra also comes with some potential drawbacks that need to be considered before making an investment. The principal amount and interest earned from KVP are taxable according to the income slab of the individual. Also, there are no extra tax benefits for senior citizens.

Investment decisions must be taken after considering various aspects such as risk-return trade-off, market conditions, financial goals, and investment tenure. While the Kisan Vikas Patra is a beneficial saving option with significant merits, investors must evaluate all aspects to ensure that it aligns well with their financial plans and aspirations.


The Kisan Vikas Patra is a valuable investment tool, offering guaranteed returns, flexibility, high security, easy purchase and transfer options, and tax concessions. Launched by the Government of India, KVP assures investors with a low-risk investment and guaranteed returns at a fixed interest rate of 6.9% compounded annually. However, as with any other financial plan, the pros and cons must be weighed carefully before deciding to invest in the KVP. It’s a reliable investment option suitable for people looking for long-term, low-risk and secure investing alternatives with a guarantee of steady return growth.


Investment in the Indian financial market is subject to market risks. It is recommended that potential investors should carefully read the scheme information document and seek expert consultation before making any decisions.

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