Can NIPOST generate N200bn annually?

Many pundits figuratively announced the obituary of the Nigerian postal service when the internet first became a commonplace in the country about 15 years ago. Perhaps there is no sector that has been so challenged by the internet revolution as much as the postal sector of our economy. Because the internet is like a direct […]

Many pundits figuratively announced the obituary of the Nigerian postal service when the internet first became a commonplace in the country about 15 years ago. Perhaps there is no sector that has been so challenged by the internet revolution as much as the postal sector of our economy.

Because the internet is like a direct substitution of post office processes, many Nigerians now prefer to send emails or even send short messages and make voice calls via their mobile phones. So, many customers of the Nigerian Postal Service [NIPOST] have found quicker, smarter, and cheaper alternatives.    

But all is not lost as the Federal Government is presently making moves to transform the postal agency into a revenue generating ‘machine’. 

The Minister of Communications Adebayo Shittu said in an interview recently that the agency would be able to garner huge revenue annually if the current reforms at the agency were successfully carried out.  

 The agency, he said, was looking at N200billion annual revenue from new services it recently launched.

He listed electronics stamps, money order, postal improved courier services, agency banking, e-commerce, and real estate services as some of the new services that would be generating billions of naira to FG’s coffers every year.

According to him, some of the over 1,500 NIPOST facilities [vehicles and buildings] across the 774 local governments would be rehabilitated and turned into a revenue ventures. 

With such enormous facilities, he said the agency was better placed to make more money from e-commerce than commercial banks and courier operators.     

He also said the new NIPOST would begin a haulage services which would afford manufacturing industries and individuals the opportunities to transport their goods all over Nigeria and abroad.

He said some NIPOST facilities would be converted to malls and rent out to business men and women.

 The Post Master General of NIPOST Barrister Bisi Adegbuyi even took the target higher than Shittu’s. The postal agency will now be generating more than a billion naira daily with its innovative products, Adegbuyi said in an event in Abuja recently.

He also said the current management of NIPOST had decided to change the narrative about the agency with new products. 

“The journey of NIPOST’S transformation has just begun. We have bright future ahead. We see billions of naira being generated daily by NIPOST. 

He said; “This product launch today reaffirms our stance to adopt the multi-activity business model with operations in Banking, Insurance, Real Estate, E-commerce, etc. This effort requires strong collaboration with the private sector whose investment capital and expertise cannot be over emphasized. This model is what this year’s global top three in the postal industry (Switzerland, France and Japan) and the regional champions (Brazil, Mauritius, Poland, Singapore and UAE have adopted. Some other African countries like Morocco and Tunisia have already joined the league.

“We are indeed getting back on track as we are reinventing ourselves, embracing digitization, redefining our value proposition and developing new products and services. In this regard, we require the strong political support that we are already getting from the Federal Government. I can assure you that in no distant future we shall be number one on the African chart.

“There is much to be gained from this transformation: more satisfied customers, stronger postal market and network. As we strive to meet the United Nation’s Sustainable Development Goals we should not forget that the postal infrastructure is an enabler of inclusive development and a key platform for delivering public services pivotal to the attainment of the SDGs.’’

On agency banking, he said NIPOST’s technical advisers had advised the agency to do a cocktail of payment settlement: agency banking and financial services that it could comparatively and advantageously go into without adding to its already heavy recurrent expenditure that is today a major albatross for Nigerian postal services.

He also said the mantra would be subscription to ICT and deployment of technology. ‘’Let me restate it here: Postal services worldwide thrive on technology. What email has taken away from us, it has given us ten times of in terms of exponential growth in parcel services through eCommerce. We are going to make a lot of money from that end. Of course paucity of funds is a major challenge but we must find a way around it and move ahead.’’    

But Anozie Chukwu, an IT expert based in Abuja, believes it will be very difficult for NIPOST to make a comeback. Internet, he said, had already taken over the market and catch up with be ‘’ very difficult’’.

However, Kareem Afeobawa, another IT expert, disagrees. He said though more than 90 per cent of youths in the country has nothing to do with the Post Office, new reforms embarked upon by NIPOST could still attract these youths back.

He said; ‘’ Even NIPOST can capitalise on the digital transformation while leveraging the power of its trusted brand and location infrastructure to engage the youths in a positive manner by providing modern digital service that appeal to them through mobile applications and the various social media channels.’’

NIPOST’s spokesman, Mr Franklyn Alao said the agency is already thinking in this direction. According to him, digital/business centres have been slated to be created in post offices within tertiary institutions’ campuses, and in rural areas  across the country. These will provide training and innovative e-services such as computer-based exams and other services for disadvantages youths residing in the rural areas.

Though the minister and the NIPOST PMG are so confidence the agency will soon bounce back, some experts believe how fast the postal agency is able to catch up with the ever increasing pace of technology will determine whether the two top officials will have the last laugh.