KRA strikes deal with Posta to renew driving licences
Posta will collect fees for renewing driving licences and issue renewal stickers. FILE
Kenyans can now renew driving licences and pay stamp duty for land at any post office countrywide after the tax collector outsourced the service to reduce congestion at its Times Tower headquarters in Nairobi.
The Kenya Revenue Authority (KRA) has appointed Postal Corporation of Kenya (PCK) to collect fees accruing from stamp duty on property deals, collect fees for driving licences and issuing renewal stickers.
Posta exploited its wide geographical reach to obtain a chunk of the driving licence renewal business from mid-sized lender National Bank in a strategy to introduce new income streams and cut over-reliance on the letter business.
PCK said it is currently offering the services at 82 outlets and plans to roll out the tax agency service at its 622 outlets nationwide.
“We are in every corner of the country and this puts us in a good position to offer agency services on behalf of government departments like KRA,” said Titus Juma, general-manager in charge of financial services at Posta.
“We are positioning ourselves in the payments industry to diversify our business.”
Posta declined to disclose the commission it will earn, but said it is based on the transaction volumes.
Mr Juma said Posta is currently renewing an average of over 2,000 driving licences per day.
The State-owned corporation further disclosed it will from July collect contributory payments for the National Social Security Fund (NSSF) after it completes integrating its systems and database. NSSF payments are expected to shoot up considerably after the implementation of higher contributions by the fund.
Posta entry into land stamp-duty collection creates competition for the service currently offered by lenders National and KCB banks.
KRA said the appointment of Posta to collect some taxes will help decongest its offices and make it convenient to pay levies.
PCK’s traditional snail-mail business is facing stiff competition from new technologies like e-mail and SMS —as people shift away from post-delivered letters and cards.
It is also facing competition from a growing number of private courier operators such as Roy Parcels, Nation Courier, bus companies and even matatus.
Posta’s other diversification projects include paying the elderly, orphans cash subsidy and acting as a super-agent for M-Pesa.
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