Banking News

Modalities for commission payable to KVP agents at Banks

The authorized agent who canvasses for sale of  Kisan Vikas Patra (KVP) is eligible to receive the commission from the bank to which he/she is attached for the purpose.The agent can register at multiple branches of banks in his/her area of operation for the purpose of canvass and purchase of KVP certificates on behalf of the investors.

Registration at Bank as a commission agent:

An individual can register himself/herself as a commission agent for KVP certificates by submitting a copy of his/her valid certificate issued by State Government Authorities to the Branch Manager of the Bank.The original certificate should also be produced for verification when required by the Bank. Opening a SB account in the same branch of the bank is another prerequisite to register as commission agent.The commission received by the agent will be credited only to the account opened by the agent for this purpose.

Collection of investment:

The agent will collect the application for investment in KVP from the investor along with cash/cheque and other documents for KYC from the investor and issue a receipt in A.S.S.II form. The agent then submits the application with cash/cheque to the bank on the same day or the next day. Bank would acknowledge the receipt of application and cash or cheque, on the receipt book A.S.S. II held by the agent and also issues preliminary receipt for investment, if the certificate cannot be issued immediately. The agent has to deliver the certificate to the investor and obtain acknowledgement from him/her on back of investor’s copy of the receipt A.S.S.II.

For claiming commission from the bank, the agent has to submit a statement of all the transactions made during the day supported with the investor’s copies of receipts duly acknowledged as early as possible within the calendar month of the transaction to the bank as proof of caim of his/her commission. Bank will release the commission to the credit of agent’s SB account after full satisfaction with regard to sale of certificates through the agent.

Cash handling limit and commission amount:

The department of Post (Department of Communcation & IT) in its circular reference SB order no.8/15 dated 15.07.2015 communicated that Cash handling limit of authorized agents increased from Rs.10000/- to Rs. 20000/- and Agent’s Commission in r/o KVP enhanced from 0.5% to 1% w.e.f. 15.07.2015. It appears that RBI has not made any change in this regard. As per RBI communique dated 10.09.2015 the validity of the agency of agent, eligibility of investor to make investment, and cash handling limit (presently Rs.10,000/- at a time) will be ascertained and documents submitted will be examined by the bank before accepting investment through an authorized agent.

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