Posta Uganda, one of the country’s last remaining parastatals, is set to partner with a local telecom firm in a new mobile money transfer service along the lines of Kenya’s M-Pesa.

Under M-Pesa, subscribers of telecommunication giant Safaricom are able to send and receive money using their cellphones.

Posta Uganda will also set up tele-centres in at least 20 of its outlets courtesy of a $300,000 grant from the World Bank through the Uganda Communications Commission.

These are part of the reforms spearheaded by ICT Minister Dr Ham Mulira, who wants to transform Posta Uganda into a profit-making company.

The Rural Communication Development Fund, a universal service kitty pooled from one per cent of the gross annual revenue of operators will also be used to start up more telecentres.

“We have completed the procurement of all equipment for the first phase of the telecentre project. While bandwidth issues remain, these will be solved with the national backbone,” said Posta Uganda managing director James Arinaitwe.

The parastatal has 300 outlets across the country and is linked to 700,000 post offices worldwide. It also partners with Brussels Airlines, which transports its mail to destinations worldwide.

Although the Posta management is still tight lipped on the likely partner firm, experts are betting on Uganda Telecom as the ideal candidate, as it has as wide a coverage and presence as Posta. The two bodies were a single entity before Uganda Telecom was privatised.

Although the firm has liabilities to the tune of Ush11.8 billion ($7.2 million) and has lost out to other couriers by failing to adapt to new technologies, it is projected that by June 2009 Posta Uganda Ltd will have paid all its debts.

In the past five months, some of Posta’s debtors have threatened to take the firm to court unless it commits to pay its debts by the end of the year.

Posta owes Postal Corporation of Kenya $1.1 million on the inter-state account as of July this year. It is being charged six per cent per month on the cumulative amount.

In a July letter to the parastatal, the Uganda Revenue Authority wants it to pay Ush3.4 billion ($2 million) in tax arrears while Uganda Telecom, in a September 3 letter, is demanding Ush1.17 billion ($730,000) plus a detailed payment plan.

Other debtors are the National Social Security Fund, the Labour Union and Kampala City council.

The ICT Committee chairman in parliament, Edward Baliddawa, has recommended that the government employs the most efficient means to clean up its balance sheet to enable Posta Uganda to expand, invest and improve service delivery.

“Posta Uganda will increase revenue by at least 10 per cent and grow the average market share by at least 25 per cent per annum as well as institutionalising quality assurance,” says the parastatal’s 2008 financial year plan.

Posta has also indicated that it will invest in improving EMS services, establish postcodes and address management systems as well as counter automation.

“Everybody thought Posta Uganda had died, but I believe we have been appreciated and we shall work hard to provide quality services as we have already done in the past five months,” said Mr Arinaitwe.