Kisan Vikas Patra relaunched
Kisan Vikas Patra relaunched, Finance Minister Arun Jaitley and Communication Minister Ravi Shankar Prasad relaunched Kisan Vikas Patra (KVP) on Tuesday.
- Aimed at boosting sagging the savings rate
- Saving rate has fallen from 36.8% t0 30%
- Money to double in 100 months; No upper limit
- PAN not required; nomination, transfer to another post office in country available
- After 30 months, they can be encashed or pledged as security
- 8.7% return like PPF, but no tax sops as in the case of PPF
- Initially, available through post offices and later at designated banks
New Delhi: Finance Minister Arun Jaitley and Communication Minister Ravi Shankar Prasad relaunched Kisan Vikas Patra (KVP) on Tuesday. "In the last 2-3 years, the savings rate in the country has declined from a record high of 36.8 per cent to below 30 per cent due to a slowdown in the economy. It is, therefore, necessary to encourage people to save more," Finance Minister Arun Jaitley said at the launch here of the revamped KVP. There is no requirement of PAN and no upper age limit for investing in it. The scheme aims to boost saving and use them for long-term capital requirement. "This will be a bearer instrument just like currency and easy to encash," he said.
The amount invested in KVP will get doubled in 100 months or eight years and four months. This means KVPs would be giving a return of 8.7 per cent annually. This is in line with 8.7 per cent per annum interest rate offered by another popular savings instrument public provident fund (PPF). However, investors would not get any tax benefit for their investment in Kisan Vikas Patra unlike in PPF.
The KVP would be available in denominations of Rs 1,000, 5,000, 10,000 and 50,000 and there is no upper limit on investment in KVPs. The certificates can be encashed after a lock-in period of 30 months or 2 years and 6 months. Thereafter, investors can withdraw in any block of six months.
The facility of transfer from one post office to another anywhere in India and of nomination is also available. They can also be pledged as security to avail loans from the banks.
Initially, the Kisan Vikas Patra certificates will be sold through post offices, but later on they will be made available to the through designated branches of nationalised banks. KVP scheme was originally launched in 1988 with a maturity period of five-and-half-a-years and the money invested doubled on maturity.