ICT secretary Fred Matiang’i withdraws cash using Posta Pesa service, Posta’s e-payment solution during its launch at the General Post Office in Nairobi on July 30, 2013. Photo/Diana Ngila
What you need to know:
The ICT ministry will push for Posta to be awarded the role of handling all public sector electronic payments.
The ministry has contacted the Universal Postal Union to work with a national committee formed to develop a master plan to guide PCK’s modernisation.
Private information technology (IT) firms will be locked out of tenders for government electronic payment systems in favour of the Postal Corporation of Kenya (PCK), the ICT secretary Fred Matiang’i has said.
Mr Matiang’i said Tuesday the ministry will push for Posta to be awarded the role of handling all public sector payments, with the government fast-tracking the adoption of a similar model that is employed in Brazil.
Brazil’s postal corporation handles all government payment systems and in the process, accesses a key revenue stream that has helped it remain afloat in the face of drop in use of mail services with the advent of the Internet.
“We will be going to the Cabinet with a paper to request approval for our proposal that all public sector payments be handled by the Postal Corporation,” said Dr Matiang’i during the launch of Posta Pesa, the corporation’s new Sh84 million e-payment platform.
He said the ICT ministry has contacted the Universal Postal Union to work with a national committee formed to develop a master plan to guide PCK’s modernisation.
PCK, which launched its new e-payments system yesterday, has pledged to grow its revenue by 39 per cent per year for the next three years, and will be targeting diversification from its traditional mail business as a means to achieve this.
The awarding of a contract to handle national payment services to PCK would come as a boost to the corporation which has fallen behind other industry players especially in adoption of ICT, although competitors could yet raise concerns if the contract were not a subject of an open tender.
PCK is set to use the new platform to enter the agency banking and mobile money transfer services, enabling it to transact electronically with banks through use of smart cards.
The system will enable it to exchange financial information with banks, merchants, and various third party agents electronically as opposed to the current manual format.
It will also enable PCK to issue smart cards which will facilitate various utility payments and enable financial integration with mobile money transfer platforms.
The firm has existing partnerships with utility companies, and according to the Postmaster-General Enock Kinara the e-platform will enable the corporation to bring in government and financial institutions.
“We now have an EMV compliant system meaning we can handle cash, cheques, cards, mobile money and e-government services. This will also enable us to handle tax payment services, and we can be able to make all public payments cashless in our over 600 branches,” said Dr Kinara.
The move by the ICT ministry comes at a time when PCK’s traditional core business of letter delivery has declined. Data from the Communications Commission of Kenya (CCK) shows that 17.3 million letters were sent in the quarter to December 2012, compared to 19.7 million in the same period a year earlier.
International outgoing letters dropped to 1.9 million from 2.2 million, while incoming letters increased by 138 per cent to 191,612.
In February 2012, PCK raised the charges for most of its mail services by between Sh5 and Sh15 while raising leasing fees postal box by up to Sh1,800, helping raise revenues to Sh3.5 billion from Sh3.2 billion a year earlier.
