Government of the Kyrgyz Republic on July 11, 2013 received a loan and grant from the International Development Association (hereinafter – the World Bank) to finance the implementation of the project “Financial Sector Development” (FSD Project P125689). The project includes as its main component (Component 2) the expansion of financial services through the branch network of “Kyrgyz Post” (KP). This component will transform the existing postal service into an economically efficient channel for providing basic financial services to ensure their accessibility to poor populations and rural communities.

The current range of financial services of the State Enterprise Kyrgyz Post (KP) is mainly limited to domestic money payments and paper-based payment processing. These services include:

  • distribution of funds for state pensions and social security (benefits);
  • collection of cash payments for utilities, telecommunications companies, taxes, traffic fines, and school fees; as well as
  • domestic and international postal money transfers and other money transfers.

The goal of the component is to transform the current operations of KP into a profitable market channel for distributing basic financial services.

Objectives of Component 2 “Expansion of financial services through the branch network of Kyrgyz Post”:

(i) Strengthening KP’s capacity in financial management within its current corporate reform policy, including:
(a) improvement of key financial management systems;
A methodology has been developed for financial accounting and cost calculation, asset management, risk management and human resources management, procedures for budget formulation and execution, internal audit and internal control guidelines, and a strategic internal audit plan for 3 years and annually.
(b) support in preparing financial statements according to International Financial Reporting Standards (IFRS) and conducting external audits;

An audit of KP’s financial statements for 2016-2017 was conducted in accordance with IFRS. The audit opinion on KP’s financial activities for 2016-2017 is posted on the official KP website www.post.kg

(ii) Support for reorganization of paper-based business processes for mass low-value financial transactions, including:
(b) installation of ICT components;

Under a contract with the company “BAIP,” postal technologies (software products and equipment) are being supplied to KP to expand access to financial services. This subcomponent supports reengineering of paper-based business processes for mass flows of small payments or financial transactions. It will implement and expand modern information and communication technology (ICT) architecture for financial service distribution, significantly improving quality, timeliness, reliability, cost-effectiveness, and dependability of financial service delivery.

(iii) Expansion of the range and volume of financial services provided through KP, including:
(a) capacity building in financial service management;
As part of KP’s rebranding supported by the Project, a Brand Book was developed as the basis for policy, guidelines, and references to support effective and attractive modernization of its post offices and all media used by Kyrgyz Post. The KP Brand Book is a written manual explaining how the brand should be used both internally and externally. It contains specific instructions on how tangible brand elements should be used in all forms of corporate communication: from business cards to advertising, packaging to signage, and everything in between. By following the brand guidelines, KP can leave its mark at all points of contact.

Planned activities for the development of the postal system of Kyrgyzstan

Strengthening the capacity of Kyrgyz Post staff by establishing training classrooms.
To expand services throughout the postal branch network, and to improve quality, timeliness, reliability, and cost-effectiveness of public services—which require ongoing staff training, retraining, and upgrading—training classrooms are planned to be opened at Kyrgyz Post in Bishkek, Balykchy, Jalal-Abad, and Osh. Classrooms will be equipped with modern computers, networking equipment, and office furniture.
Training will be conducted both in-person and remotely.

Creating a sustainable training system and building highly professional personnel capacity at all levels.
Training for 1,200 KP employees:

  • Operators;
  • Postal branch managers;
  • Specialists and staff of back offices and the head office, etc.

The training will focus on professional development and retraining of employees.

Strengthening financial management at Kyrgyz Post
Provision of additional equipment to KP for effective functioning of financial management software (ERP) to expand access to financial services.