This Post Office scheme aids to double your money; here's what we know
Post office schemes can be a great way to save money for people who don't like taking risks and are sceptical of putting their money in the stock market.
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FollowIndividuals looking to save or park their money in a safe scheme can take advantage of India Post, which is part of the Department of Posts. Post office schemes can be a great way to save money for people who don't like taking risks and are sceptical of putting their money in the stock market.
The fact that the government backs the schemes offered by India Post makes them a lucrative option. Another advantage is the tax exemption under Section 80C that investors can obtain for several post office saving schemes.
Here's a detailed look at one such scheme, Kisan Vikas Patra, which was launched in 1988 and offered a 6.9 per cent interest rate:
1) About the rate of interest
The interest rate in this savings plan is 6.9 per cent, compounded annually. In 10 years and four months, the invested amount doubles. The minimum amount required to open an account is Rs 1,000, with no upper limit.
2) About the eligibility
Following the India Post website, eligible investors include
(i) a single adult
(ii) a joint account (up to 3 adults)
(iii) a guardian acting on behalf of a minor or a person of unsound mind (iv) a minor above ten years in their own name
It should be noted that the scheme allows for the creation of an unlimited number of accounts.
3. About the maturity
The deposit will mature on the maturity date specified by the Ministry of Finance from time to time, as of the date of deposit. While the scheme matures in 124 months, there is a 30-month lock-in period.
A KVP account can be closed prematurely at any time before maturity, subject to the following conditions:
(i) On the death of a single account holder or any or all of the account holders in a joint account
(ii) On forfeiture by a pledgee who is a Gazette officer
(iii) When ordered by a court
(iv) After two years and six months from the date of deposit
4. Account transfer from one person to another
KVP can only be transferred from one person to another under the following conditions:
(i) When the account holder dies, the account is transferred to the nominee/legal heirs.
(ii) When the account holder dies, the joint holder inherits the account (s)
(iii) The court's order
(iv) When an account is pledged to the specified authority
In this scheme, investors can use their KVP certificate as collateral or security to obtain secured loans. The interest rate on such loans is relatively low.
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