Kisan Vikas Patra: How long does it take to double your money with KVP?

Suppose you are looking for a safe investment option that guarantees to double your money over a fixed period. In that case, Kisan Vikas Patra (KVP) is one of the most popular small saving schemes offered by the Government.

KVP is a small savings certificate scheme that allows you to invest a lump sum amount, which then grows at a fixed rate of interest.

The Finance Ministry declares the Kisan Vikas Patra interest rate every quarter. The scheme is popular for safely doubling an investor's money during the investment period.

How KVP doubles your money: An example

KVP works on compound interest, meaning the interest you earn each year is added to your principal, and the next year’s interest is calculated on this increased amount. This compounding effect helps your investment grow faster and eventually doubles your money.

The amount invested in a KVP account doubles in 115 months (approximately 9 years and 7 months) at a 7.5% interest rate.

For example, if you invested ₹ 1 lakh. Your initial investment of ₹1,00,000 will grow every year with interest added to the principal. By around 9 years and 7 months (115 months), your investment will double to ₹2,00,000

To curb potential misuse and ensure transparency, the government made it mandatory to provide PAN details for investments exceeding ₹50,000 starting from 2014.

For investments of ₹10 lakh or more, you will also need to submit proof of income, such as salary slips, bank statements, or income tax returns. If you are looking to invest in higher denominations like ₹50,000 certificates, these are typically available only at the head post offices in major cities.

While KVP is a safe and reliable scheme, it doesn’t provide tax benefits under Section 80C like some other government schemes, such as PPF or NSC. TDS @ 10% is deducted every year on the interest credited.