From April 1, Kisan Vikas Patra Interest Rate Cut To 6.9%, Maturity Period Extended

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From April 1, Kisan Vikas Patra Interest Rate Cut To 6.9%, Maturity Period Extended

The rate of return for small savings schemes such as KVP are reviewed on a quarterly basis

From April 1, investment in the Kisan Vikas Patra small savings scheme fetches a lower return of 6.9 per cent, compared to 7.9 per cent in the quarter ended March 31. Also, the Kisan Vikas Patra’s maturity period stands reduced to 124 months from April 1, compared to the existing period of 113 months. Which means, now any investment in the certificate scheme – available at designated post office branches – doubles in size in a period of 124 months with effect from April 1.The government has lowered interest rates on most small savings schemes by 80-140 basis points (0.8-1.4 percentage point) for the first quarter of financial year 2020-21, according to an official statement. 

Here are the interest rates applicable to other small savings schemes in the April-June period:

Instrument Interest Rate In January-March Interest Rate In April-June Compounding Frequency
Savings Deposit 4% 4% Annually
One-Year Time Deposit 6.9% 5.5% Quarterly
Two-Year Time Deposit 6.9% 5.5% Quarterly
Three-Year Time Deposit 6.9% 5.5% Quarterly
Five-Year Time Deposit 7.7% 6.7% Quarterly
Five-Year Recurring Deposit 7.2% 5.8% Quarterly
Senior Citizen Savings Scheme (SCSS) 8.6% 7.4% Quarterly and paid
Monthly Income Account 7.6% 6.6% Monthly and paid
National Savings Certificate 7.9% 6.8% Annually
Public Provident Fund 7.9% 7.1% Annually
Sukanya Samriddhi Account 8.4% 7.6% Annually
(Source: dea.gov.in)

Currently, the Ministry of Finance offers nine types of small saving schemes, including the 15-Year Public Provident Fund (PPF), the Senior Citizen Savings Scheme (SCSS) and the Sukanya Samriddhi scheme, and revises the interest rates applicable to them on a quarterly basis. 

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