The South African Post Office (SAPO) wants to win back its exclusive right to deliver small parcels. It said the loss of this right is a risk to its business.
The state-owned company raised the issue in its annual report for the 2025/26 period, TopAuto reported. The Post Office called the loss of its licence a material risk to its operations.
For 25 years, the Post Office held a reserved services licence. It gave the company the sole right to deliver small packages weighing less than 1 kilogram.
That licence expired in March 2025. The Post Office applied for it again in March 2026, and the application is still being processed.
Even if the licence is granted, the terms have changed. The Post Office will no longer have the same exclusive rights it had before.
According to Newsday, the Department of Communications and Digital Technology ended the small parcel monopoly in December 2025. Minister Solly Malatsi gazetted a notice that changed Schedule 1 of the Postal Services Act.
Schedule 1 lists the postal services that only the Post Office may provide. It used to include letters, postcards, printed matter and small parcels. The words “small parcels” have now been removed.
The change has not yet been ratified by the Independent Communications Authority of South Africa. Malatsi said in July that this step was still outstanding. Until it is done, the Post Office keeps its exclusive right for now.
The Post Office said removing parcels under 1kg from its reserved services threatens its business model. It called the change a “material development” that would remove a key source of income in its business rescue plan.
Its strategic business plan, published in mid-2025, expects courier and parcel income to grow from R38 million to R1.4 billion by 2029. That forecast assumes the Post Office keeps its exclusive right to deliver some types of packages. Without it, the company would have to compete with private firms.
The Post Office went into business rescue in 2023. This followed years of losses caused by poor management, high costs and poor service. Before that, it was placed under provisional liquidation because it could not pay its debts.
The company has applied to leave business rescue but has not officially done so. To turn things around, it closed 366 branches and retrenched 4,300 workers.
Creditors also took a big loss. They received only 12c for every rand they were owed and wrote off 88% of the debt.
While the Post Office struggled, private companies took over much of the courier and delivery market. The sector is now worth about R25 billion, TopAuto reported.
Postnet competes directly with the Post Office. Bolt, Uber and Takealot have also added delivery and courier services.
In 2018, the Post Office went to court to stop private groups from delivering small packages. That attempt failed.
Source: this article is based on reporting by TopAuto.co.za. Image: TopAuto.co.za. Written with the help of AI and published by the Tzaneen Voice Business desk. See our Editorial Standards.
Anelisa Nkuna covers business and money news for Tzaneen Voice. Anelisa reports on the rand, fuel prices, interest rates, jobs, Eskom, Transnet, farming and company results. The aim is simple: explain what the numbers mean for household budgets, small businesses and workers in South Africa.