Posta struggles to recover Sh2.2 bn debt despite State intervention  

However, the amount paid so far constitutes just 14 per cent of the total debt owed to Posta.

The bulk of the corporation’s debt is owed by the government, which has failed to settle rental arrears amounting to Sh1.53 billion for the use of Posta locations as Huduma Centres.

Posta Chief Executive John Tonui told Business Daily that the corporation has received about Sh300 million from its undisclosed debtors, an amount which has been utilised in reducing workers’ salary arrears from eight months to four months.

“The National Treasury circular directing all State Corporations to pay Posta is bearing fruit, and the staff salaries arrears have now been reduced from eight months to four months, which means it is positive. We are working on ways to make sure we meet the outstanding balance within the shortest time possible,” he said.

“We are thankful to the PS for the push, and the State corporations have honoured us. We have received not less than Sh300 million from our debtors,” Mr Tonui.

In October, Treasury Principal Secretary Chris Kiptoo directed State agencies to immediately pay Sh2.2 billion owed to the financially crippled corporation, which by that time had been hit by disruptions amid a nationwide strike by its employees over six months of unpaid salaries worth Sh473 million.

Treasury’s intervention came after CEO Tonui sought a helping hand from the State to forestall the ongoing financial crisis rocking the business, whose operations are nearly grinding to a halt.

In a circular to all the accounting officers dated October 24, 2025, Mr. Kiptoo said that the outstanding Sh2.2 billion debt has caused financial difficulties to the corporation and impacted its ability to operate to its full potential and meet its employee and operational obligations.

Liquidity challenges

“Ministries, Departments, and Agencies (MDAs) owe the Postal Corporation of Kenya (Posta) over Sh2.2 billion as a result of services offered in an effort to fulfil its mandate. This has caused liquidity challenges, which have impacted its ability to operate optimally and meet its employee and operational obligations,” said Kiptoo.

“Accounting officers are hereby requested to immediately prioritise payment of debts owed to the Postal Corporation of Kenya within the approved financial year 2025/26 Budget estimates. You are required to bring the content of this letter to the attention of the affected Heads of State Corporations/Semi-Autonomous Government Agencies (SAGAs) under your respective Votes.”

According to Kiptoo, the affected MDAs were required to provide feedback on the action taken to process the payments by October 29, 2025.

Details from the National Treasury show that other State agencies that owe Posta money include the Independent Boundaries Electoral and Boundaries Commission, which has not honoured its outstanding Sh298.85 million debt after Posta entered into a three-year logistics deal to distribute election materials during the 2022 general elections.

The corporation’s other debtors include the Star Newspaper (Sh34.24 million), Kenya Tissue and Transplant Authority (Sh27.98 million), National Oil Corporation Ltd  (Sh27.72 million), Kenya Medical Supplies Authority (Sh16.26 million), Office of the Directorate of Public Prosecutions( Sh14.79 million), and NHIF (Sh9.74 million).

Attract strategic investors

Posta says it is grappling with a monthly staff cost of Sh118 million and annual payroll costs of about Sh1.7 billion compared to annual revenues of Sh2.3 billion, which the corporation says is ‘not enough’ to cater for the operational costs.

It expects to render about 400 employees redundant by June this year as it seeks to reduce its workforce to 1,650 from the current 2,070 as part of the cost-cutting measures to survive the harsh times where its business has been disrupted by technology.

The corporation is also awaiting approval from the National Treasury to sell part of its dormant assets, mainly land, to clear liabilities amounting to Sh7.2 billion and attract a strategic investor to revive its operations.

A disclosure by the Communications Authority of Kenya (CA) shows that the corporation also plans to revise the individual letter box annual rental fees by 10 percent to Sh2,200 from the current Sh2,000 and raise corporate box rates by 5.8 percent to Sh10,000 from the current Sh9,450, citing rising operational costs.

Special corporate customers would also see their fees go up 12.4 percent from Sh6,225 to Sh7,000, if the proposal is approved, while for learning and religious institutions, rental charges would increase 3.6 percent to Sh8, 000 from Sh7,725.