NSC (National Savings Certificate) and KVP (Kisan Vikas Patra) are government-backed post office savings schemes — guaranteed returns, sovereign safety, and tax benefits (NSC). Popular with conservative investors who prioritize safety over returns.
This guide compares NSC and KVP, explains current interest rates, tax treatment, and how to choose between them.
Calculate NSC & KVP Returns — Free
Compare maturity values for both post office schemes.
NSC Basics
- Tenure — 5 years
- Current rate — 7.7% (compounded annually, paid on maturity)
- Minimum — INR 1,000
- Maximum — No limit
- Tax benefit — Section 80C deduction up to INR 1.5 lakh annually
- Interest taxable — Yes, but reinvested annually counts under 80C
KVP Basics
- Tenure — 115 months (~9 years 7 months)
- Current rate — 7.5%
- Doubles money — investment 2x at maturity
- Minimum — INR 1,000
- Maximum — No limit
- Tax benefit — None (no 80C)
- Interest taxable — Yes, on maturity
NSC vs KVP Comparison
| Feature | NSC | KVP |
|---|---|---|
| Tenure | 5 years | 115 months |
| Interest | 7.7% | 7.5% |
| Tax Benefit | 80C up to INR 1.5L | None |
| Premature Withdrawal | Only on death/court order | After 2.5 years |
| Loan Against | Yes | Yes |
| Best For | Tax savers | Long-term safe parking |
NSC/KVP vs Bank FD
- NSC interest ~0.5-1% higher than 5-year FD
- NSC offers 80C — FDs only "tax-saver FDs" (lock-in 5 yrs) qualify
- NSC sovereign-backed — safer than even bank FD
- NSC less liquid — premature withdrawal restricted
- FDs more flexible — premature withdrawal with small penalty
How to Use the Tool (Step by Step)
- 1
Pick Scheme
NSC or KVP.
- 2
Enter Investment Amount
Minimum INR 1,000.
- 3
See Maturity Value
Tool calculates with current interest rate.
- 4
Compare with Other Options
See tax-adjusted returns vs FDs, mutual funds.
- 5
Buy at Post Office
Visit nearest post office or use online India Post portal.
Frequently Asked Questions
Is NSC better than tax-saver FD?+−
Slightly — higher interest rate (7.7% vs 6.5-7%). Both have 5-year lock-in. NSC interest reinvested counts under 80C.
Can I break NSC before 5 years?+−
Only on death of holder or court order. Otherwise, no premature withdrawal.
Is KVP available everywhere?+−
Yes, at all post offices in India and select bank branches.
Can NRIs invest in NSC/KVP?+−
No. Only resident Indian individuals can invest. NRIs need to redeem before becoming non-resident.
How is NSC interest taxed?+−
Interest accrues annually and is taxable. But reinvested interest counts as fresh investment under 80C (auto-deductible).
Can I take loan against NSC?+−
Yes — banks accept NSC as collateral for loans. Up to 75-80% of NSC value loanable.
Calculate NSC & KVP Returns — Free
Compare maturity values for both post office schemes.
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