What is Kisan Vikas Patra?

Kisan Vikas Patra was introduced in 1988 by the India Post as a small savings certificate scheme. The primary purpose of this scheme was to introduce long-term financial planning concepts to the public. Currently, the scheme has a tenure period of 9 years and five months for investment. People can invest with a minimum of INR 1,000, and no upper limit is attached.

Moreover, there is a benefit of investing a lump sum amount. Lump sum amounts can give double returns at the end of the investment. This investment is open to everyone; however, as the name suggests, it was initially intended for farmers. Submitting your PAN card is mandatory if you are investing more than INR 50,000. Additionally, if the investment is above INR 10 lakhs, you must submit proof of income, like ITR documents, salary slips, and bank documents.

Kisan Vikas Patra is a safe investment suitable for people looking for a long-term investment plan. The investors must submit their Aadhar card to start the Kisan Vikas Patra scheme, regardless of the amount.

Kisan Vikas Patra Calculation Formula

If you are interested in investing in Kisan Vikas Patra, knowing your return is always an excellent option. You can use a Kisan Vikas Patra calculator online and enter your details to determine the amount you will make by the end of your investment. Meanwhile, you can also refer to the formula mentioned below to understand the calculations:

The formula to calculate Kisan Vikas Patra is:

A = P (1 + r/n) ^ (nt)

Here,

• A = The maturity amount
• P = Principal amount
• R = Rate of interest
• T = Tenure of the investment
• N = Number of times the interest gets compounded

KVP Interest Calculation with Examples

Let’s understand the above formula with a hypothetical example. For instance, you decided to invest INR 1 lakh in the KVP scheme, with an interest rate of 7.5% annually. In this case, your interest rate will be INR 7500 after the first year's end. This INR 7500 will be added to your principal amount for the next year, increasing to INR 1,07,500.

In the second year, you will again earn interest on INR 1,07,500, which will come to INR 8062. This amount will now be added to INR 1,06,900, and your third-year principal amount will be INR 1,15,562. This is how it is calculated for the remaining tenure. 

How to Use ClearTax Kisan Vikas Patra Calculator?

It is very easy to use the ClearTax Kisan Vikas Patra calculator. You need to follow the below steps, and with a click, you can determine your maturity amount:

• Step 1: Open the ClearTax Kisan Vikas Patra calculator.
• Step 2: Enter the amount you wish to invest.
• Step 3: Mention the tenure for which you plan the investment in months.
• Step 4: Click on the Calculate button to check your maturity amount.
• Step 5: Your maturity amount will be displayed.
• Step 6: You can change the investment amount and tenure to determine how you can get more money at maturity.

Benefits of Using the Kisan Vikas Patra Calculator

Here are some of the benefits of using a Kisan Vikas Patra calculator:

• Determine returns - Using the KVP calculator, you can enter the principal amount and tenure to determine your estimated returns at maturity. It helps in planning finances better.
• Compare combinations - You can try different combinations by changing the investment amount and the tenure to determine which amount best fits your financial goals.
• Understanding interest - The Kisan Vikas Patra calculator can help you understand how the interest rate impacts the overall investment and savings.
• Compare with other investment options - This calculator can compare your returns with other investment savings, such as FD and bank deposits. You can determine which gives you the best returns and go with it.