This article compares the features of National Savings Certificate (NSC) and Kisan Vikas Patra (KVP)
National Savings Certificate (NSC) and Kisan Vikas Patra (KVP) are very popular investment avenues among investors seeking safety of capital. But since both these are very similar, one can get confused while choosing between the two.
Here is a comparison of the features of NSC and KVP, to help you take an informed decision while investing.
(Want to know about saving income tax? Please read “Saving Income Tax – Understanding Section 80C Deductions“)
| Feature | National Savings Certificate (NSC) | Kisan Vikas Patra (KVP) |
| Issued By | Department of Post, Government of India | Department of Post, Government of India |
| Can be bought from | Authorized post offices | Authorized post offices |
| Risk Category | Virtually risk free | Virtually risk free |
| Type of interest | Fixed | Fixed |
| Interest Rate | 8% | 8.25% |
| Maturity | 6 Years | 8 Years and 7 Months |
| Amount invested qualifies under Sec 80C of the Income Tax Act (IT Act)? | Yes | No |
| Interest earned qualifies under Sec 80C of the Income Tax Act (IT Act)? | Yes | No |
| At maturity, Rs. 100 becomes | Rs. 160.10 | Rs. 200 |
| Minimum investment | Rs. 100 | Rs. 100 |
| Maximum investment | No limit | No limit |
| Other features | Interest is reinvested, and is paid along with the principal at the time of maturity | Investment doubles at maturity |
| For more information, see: | National Savings Certificate (NSC) | Kisan Vikas Patra (KVP) |
Thus, we see that the major differences between National Savings Certificate (NSC) and Kisan Vikas Patra (KVP) are the tenure of investment, the rate of return and their tax treatment.
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