At the time when the stock markets are volatile and you are not sure of investing in the equity markets instead looking for safer investment options with assured returns, then this may be of interest to you. You can invest in small savings schemes. One of the most popular schemes in the Kisan Vikas Patra. This scheme offers attractive interest rates and is one of the highest among the savings schemes. However, there are schemes which offer higher interest rates.

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Kisan Vikas Patra – Interest rates, features and benefits

Kisan Vikas Patra is currently offering an interest rate of 6.9 per cent. The interest is compounded annually.
Amount Invested doubles in 124 months (10 years and 4​​​ months)
Minimum investment of Rs 1000 and in multiples of Rs 100 can be made. There is no maximum limit.

Top features

1- Who can open - a single adult or a joint account up to 3 adults or a guardian on behalf of minor or on behalf of person of unsound mind or a minor above 10 years in his/her own name.

2- Deposit - Minimum of Rs 1000 and in multiples of Rs 100 with no maximum limit.

3- Any number of accounts can be opened under the scheme.

4- The deposit shall mature on the maturity period prescribed by the Ministry of Finance from time to time as applicable on the date of deposit.

5- Pledging of account - KVP may be pledged or transferred as security

Jitendra Solanki, Expert in Personal Finance Matters said that small savings schmes are one of the most popular investment instruments and offers reasonable returns which are also assured. He said that the biggest benefit of KVP and other savings schemes is that they come with a sovereign guarantee. 

They also give income tax benefits under Section 80C of the Income Tax Act, he added. 

Out of the 12 schemes, we will tell you about top 3 schemes with highest rate of interests. The top three small savings schemes run by the government of India are Senior Citizens Savings Schemes (SCSS), Public Provident Fund (PPF) and Sukanya Samriddhi Yojana. 

KVP scheme offers investment opportunity with assured returns, this small savings scheme could be your answer.    

The small savings schemes basket comprises 12 instruments, including the National Saving Certificate (NSC), Public Provident Fund (PPF), Kisan Vikas Patra (KVP) and Sukanya Samridihi Scheme. The government resets the interest rate at the beginning of every quarter.     

Know schemes which higher interest rates:  

Small Savings Schemes – Which schemes give you highest returns   

Instruments                                  Rate of Interest for April-June 2021      Compounding Frequency       

Sukanya Samriddhi Account              7.6%                                                       Annually   

Senior Citizens Savings Scheme        7.4%                                                     Quarterly and paid   

Public Provident Fund                        7.1%                                                      Annually   

Sukanya Samriddhi – Features and benefits  

Investments in this scheme can be made for up to two girl children or three in case of twin girls as second birth or the first birth itself results in three girl children. An account can be opened for as little as Rs 250 of initial deposit with multiple of Rs 150, thereafter, with annual ceiling of Rs 150,000 in a financial year.  The tenure of the deposit is 21 years from the date of opening of the account. Maximum period up to which deposits can be made is 15 years from the date of opening of the account. The existing rates are 7.6 per cent per annum.  

Senior Citizens Savings Scheme – Features and benefits 

The Senior Citizens Savings Scheme (SCSS) which was launched by the Government of India in 2004 offers guaranteed retirement income. You need to be an Indian citizen with 60 years of age. For those who have retired on superannuation or under a voluntary or special voluntary scheme, the age requirement is 55 years. The retired personnel of Defence Services (excluding Civilian Defence Employees) shall be eligible to invest on attaining the age of fifty years subject to the fulfilment of certain conditions. The minimum investment should be Rs 1000 while the maximum is Rs 15 lakh. Deposits can be made in multiples of Rs 1,000. The tenure is 5 years and can be extended by 3 more years. Account can be opened individually or jointly with spouse.  

PPF - Features and benefits: 

Account can be opened with minimum amount of Rs 500 while the maximum annual limit is Rs 1.5 lakh. The maturity period is 15 years. It can be extended for another 5 year. The interest rate is decided by the Government of India. The current rate being offered is 7.10 per cent. The interest is paid every year on 31 March. A loan can be taken on your PPF money. It also offers tax benefits.