Premature en-cashment of KVP
  1. If the premature encashment takes place within a period of one year from the date of purchase of the certificate, only the face value of the certificate shall be payable. No interest is payable in this case.
  2. After the expiry of one year, but before two years and six months from the date of the issue of the certificate, the face value of the certificate together with simple interest at the specified rate for the completed months for which the certificate has been held, shall be payable.
  3. If a certificate is encashed any time after expiry of two-and-a-half years, the amount payable is as specified by the government from time to time.