Interest rate of KVP is reviewed (and sometimes revised) every quarter by the government along with other small savings schemes. At the present interest rate, this little savings strategy will take 123 months, or 10 years and three months, to double your money.
According to a Ministry of Finance notification dated November 22, 2022, “The maturity period of an account opened on or after the 1st day of October, 2022 shall be ten years and three months.”
A KVP account can be started with a minimum of Rs 1,000 and then in multiples of Rs 100. There is no upper limit. KVP certificates can be transferred from person to person or from one post office to another in India.
Premature closure of KVP
According to India Post website, KVP may be prematurely closed any time before maturity subject to the following conditions : –
(i) On the death of a single account, or any or all the account holders in a joint account
(ii) On forfeiture by a pledgee being a Gazette officer.
(iii) When order by court.
(iv) After 2 years and 6 months from the date of deposit.
How to calculate premature closure value?
The table below shows the premature closure value of account opened on or after 1st day of October with Rs 1000. These rates are as per the latest notification from the Ministry of Finance.
|Period from the date of the certificate to the date of its encashment||Amount payable inclusive of interest (Rupees)|
|Two and half years but less than three years||1157|
|Three years but less than three and half years||1191|
|Three and half years but less than four years||1226|
|Four years but less than four and half years||1262|
|Four and half years but less than five years||1300|
|Five years but less than five and half years||1338|
|Five and half years but less than six years||1378|
|Six years but less than six and half years||1419|
|Six and half years but less than seven years||1460|
|Seven years but less than seven and half years||1548|
|Seven and half years but less than eight years||1548|
|Eight years but less than eight and half years||1594|
|Eight and half years but less than nine years||1641|
|Nine years but less than nine and half years||1689|
|Nine and half years but less than ten years||1739|
|Ten years but before Maturity of Certificate||1791|
|On maturity of certificate||2000|
Depending on how the interest rate on KVP changes, the amounts listed could change. Please refer to the government announcement for the most recent values.
Also read: Kisan Vikas Patra: How payment is made upon death of KVP account holder