The Postal Corporation of Kenya, commonly known as Posta, has sought approval from the communications regulator to increase the cost of local postage stamps by Sh15 to Sh50 in a bid to boost its revenues and turnaround the business.
Postmaster-General Dan Kagwe says the business, which has faced stiff competition in recent years, has been losing money on the current stamp price which was last adjusted in 2012.
Posta says higher cost of fuel and rent on leased business premises, introduction of VAT charges on postal products, increased wages and welfare costs as well as licence fees have necessitated the revision.
Last year, the utility firm delivered about 70 million letters across the country, earning Sh2.45 billion in the process but Mr Kagwe says this business is still not cost effective.
“We have not reviewed the cost for five years now and, as a consequence, we have been losing money on this specific line of business. The review is meant to match our economic circumstances,” Mr Kagwe said in an interview.
Last month, the Communications Authority of Kenya allowed Posta to increase the cost of renting a post office box by between 38 per cent and 64 per cent.