Kisan Vikas Patra is back in post offices
Posted on: 11/Jul/2014 11:16:01 AM
KVP, a bond-like instrument in which the invested amount doubles in a given period, was discontinued by UPA II. Now the Finance minister Arun Jaitley has reintroduced small savings schemes like Kisan Vikas Patra (KVP) and National Savings Certificate (NSC).
In the last scheme, the period in which the amount doubled was eight years and seven months. The amount invested in KVP can be deducted from the taxable income, reducing the tax liability of an investor. KVPs were very popular in villages as they were sold at post offices, reaching far-flung areas.
Even though it is named Kisan Vikas Patra, anyone can invest in this scheme. The reintroduction of the KVP will boost household savings. Before it was withdrawn, KVP accounted for one-fourth of the total inflows into all post office schemes. Though the maturity period is mentioned on the bond paper, the investor can withdraw the money after two-and-a-half years.
The government has also decided to issue NSC named after the girl child to specifically cater to the requirements of education and marriage of girls.
