Friday, January 20, 2017

Banking Awareness 2017 - Kisan Vikas Patra and Senior Citizen Savings Scheme (SCSS) Account | Interest Rates, Limits and Objectives


Hello and welcome to exampundit. Here are the list of all the important features, rate of Interest and objectives of Kisan Vikas Patra and Senior Citizen Savings Scheme  Account.

Kisan Vikas Patra

Kisan Vikas Patra (KVP) is a saving instrument launched by the Government for individual savers, wherein invested money doubled during the maturity period. This savings scheme was first launched by the Government on 1 April, 1988 and was distributed through post offices. It was discontinued in 2011 and later reintroduced in 2014.

Rate of Interest of KVP as of 20 January 2017 is 7.7%.

Highlights of Kisan Vikas Patra
  1. KVP is considered a part of the National Small Savings Fund.
  2. The amount invested in Kisan Vikas Patra would get doubled in 112 months or nine years and four months.
  3. Kisan Vikas Patra (KVP) certificates are available to the investors in the denomination of Rs. 1000, 5000, 10,000 and 50,000.
  4. The certificates can be issued in single or joint names and can be transferred from one person to any other person / persons, multiple times.
  5. The minimum amount that can be invested is Rs 1000. However, there is no upper limit on the purchase of KVPs.
  6. KVP is not a tax saving instrument as it does not offer any income tax exemption.
  7. The amount of KVP can be withdrawn after 100 months (8 years and 4 months).
  8. The maturity period or lock-in period of a KVP is 2 years 6 months(30 months).
  9. Reintroduction of Kisan Vikas Patra (KVP) was to provide a safe and secure investment avenue to the investors so as to help in augmenting the savings rate in the country.
  10. The scheme is also aimed at safeguarding investors from fraudulent schemes, considering the number of ponzi schemes that have surfaced particularly after the closure of KVP.



Senior Citizen Savings Scheme (SCSS) Account

Designated for individuals above the age of 60, the Saving Schemes for senior citizens in India are effective, long term saving options and offer unmatched security and features that are usually associated with any government sponsored savings program.

Rate of Interest of Senior Citizen Savings Scheme (SCSS) Account as of 20 January, 2017 is 8.5%.

Highlights of Senior Citizen Savings Scheme (SCSS) Account
  1. An individual of the Age of 60 years or more may open the account.
  2. An individual of the age of 55 years or more but less than 60 years who has retired on superannuation or under VRS can also open account subject to the condition that the account is opened within one month of receipt of retirement benefits and amount should not exceed the amount of retirement benefits.
  3. Maturity period is 5 years.
  4. After maturity, the account can be extended for further three years within one year of the maturity by giving application in prescribed format.
  5. There shall be only one deposit in the account in multiple of INR.1000/- maximum not exceeding INR 15 lakh.
  6. Account can be opened by cash for the amount below INR 1 lakh and for INR 1 Lakh and above by cheque only.
  7. Premature closure is allowed after one year on deduction of an amount equal to1.5% of the deposit & after 2 years 1% of the deposit.
  8. TDS is deducted at source on interest if the interest amount is more than INR 10,000/- p.a.

















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