Kenyans seeking postal service addresses will now be forced to dig deeper into their pockets after the cash-strapped Postal Corporation of Kenya (PCK) announced a drastic increase to its Mpost address service rates.
This significant increase will see a 2,263 per cent rise for corporate services and 400 per cent hike for individual box clients. Corporate users will now pay Sh9,450 up from the previous Sh400 per year. Similarly, individual clients’ prices hiked from Sh400 to Sh2000 annually.
MPost changes mobile numbers into virtual post office addresses that can be used by individuals and businesses for mail and parcel delivery. Users can receive mail alerts or packages and choose their desired type of delivery. MPost operates in Kenya, Rwanda, and Burundi and has 300,000 registered members and 80,000 active users.
Post Master General John Tonui said the changes will affect both Corporate and Individual boxes, which will now be assigned at Sh9,450 and Sh2,000 respectively. These addresses were previously issued at Sh400, per year. The new charges took effect on July 5, 2024.
“PCK wishes to inform our esteemed customers and the general public that the rates for Mpost virtual Boxes/Addresses for both corporate and Individual have been adjusted with effect from 5th July 20224,” he said in a notice. Earlier in 2023, the corporation had reviewed its annual subscription prices from the initial Sh300 to Sh400. The 33 per cent increase was attributed to high operating costs.
Initially, owning a private box at Posta Kenya was Sh6000 for corporates with a special rate of Sh4500 for distinctive groups. Private post boxes in sub-offices cost Sh8000 while Individual ones cost Sh2000. The new changes come at a time when the country is struggling with an already dire economy that has seen Kenyans protest over increased prices of services and commodities. “We understand that changes like this can sometimes catch you off guard, but we want to assure you that this adjustment comes with no compromise in the quality of service you’ve come to expect from us,” read part of a statement by the Posta’s administration.
The changes coincide with the withdrawal of 2024/2025 budget where the budget team had approved a Sh3 billion cash boost to aid its turn-around strategy amid pilling financial losses that have affected its operations.
Corporate structure
Out of the allocation, Sh1 billion will be used to fund Posta to implement a new corporate structure, while Sh2 billion spent to modernize its ICT infrastructure, according to the National Assembly’s Budget and Appropriations Committee (BAC). “Additional Sh1 billion (reccurent) towards PCK for the implementation of the new corporate structure. Additional Sh2 billion (development) towards PCK for ICT infrastructure modernisation,” said the committee in its report for 2024/25 budget.
Posta is implementing a new organisational structure that is aimed at reducing its wage bill ratio from 82 per cent of its revenue to 50 per cent by the end of its new Corporate Strategic Plan which runs from 2023 to 2027. Posta has also been seeking to modernise and optimise its facilities in a rapidly digitising world. The company has accumulated losses for years totaling Sh6.28 billion by June 2022, according to its most recent available financial results.
While announcing the new changes, Posta assured of its commitment to deliver innovative communication, logistical, and financial solutions to its clients.
The cash-strapped corporation was on the spot last year for giving up key revenue sources including, ceding prime land to private developers without much return for taxpayers. An audit report revealed that permanent structures have been irregularly erected on 10 parcels of land owned by the corporation.
In some instances, county governments have repossessed the properties and are collecting rent, yet Posta is faced with extreme cash shortages.
Auditor General Nancy Gathungu cited cases in Kisumu, Busia and Rongo where land belonging to PCK have been repossessed. “Parcel of land in Kisumu was repossessed by the Cunty Government of Kisumu and stalls were constructed for Kisumu traders who are reported to be paying rent to the County government,” Gathungu reported.
Posta’s land in Busia was also repossessed by the county government after the same was left lying idle for a long time. An audit inspection revealed it is exposed to encroachment.
