Kazakhstan 2011 | TRANSPORT | INTERVIEW

TBY talks to Arken K. Arystanov, Chairman of Kazpost, on operating in such a large country, innovation in the sector, and a possible IPO.

Arken K. Arystanov
Arken K. Arystanov began his professional career in 1994 at the National Bank of Kazakhstan, and in 1996 became Adviser to the Chairman of the Management Board as well as other heads of departments at ATF Bank. After a position at Halyk Bank, a six-year spell at Kazpost, and a five-year term as Chairman of the RFCA, he was appointed Chairman of Kazpost in 2011.

How would you describe the strengths of Kazpost and its extensive postal savings network?

Our company operates one of the biggest postal-savings systems in the CIS region. We have developed postal financial services and banking services. We have over 3,000 postal offices and approximately 21,000 employees. One of the good things about our company is that our post offices are located in villages all over the country. In this way, we have introduced village populations to our banking system and the postal system. Kazpost's postal savings system is a highly developed income system, and this was agreed upon by the European Postal Union (EPU), located in Switzerland. It was later put forward by the EPU that Kazpost would be an example for other countries in the region.

How has Kazpost overcome the challenging nature of Kazakhstan's vast geography?

First of all, we are looking to develop our postal offices throughout each territory, and in the future we will locate our branches in relation to population. As a postal company in the CIS region, we have established modern equipment for all our postal items. We are also starting the development of an advanced postal sorting system. We have three postal sorting system centers in Almaty, Astana, and Atyrau. They cover the south, north, and west. This system allows us to utilize time efficiently. Like other big companies, we use all forms of transportation, including air, rail, and road freight in all territories.

Which products have the highest demand?

We have generated effective ways to send post cards, parcels, letters, and items, and these services are very popular. We also perform money transfers and pay pensions and salaries. These services are also very much in demand.

Do you see competition from express delivery service companies?

Yes, but we have also developed our own express services in cooperation with the EPU. The EPU has a very well developed express mail service (EMS) system, and it is this system that we use here in Kazakhstan.

How are you competing with the larger banks in terms of your financial services?

In each region we are working to open banks in developed urban areas. In the villages we almost have free rein as a near monopoly. The second level banks do not function well in more rural areas, and for that reason our strength lies in those rural areas. The system performs well and is very profitable. The number of offices we have across the country is also a distinct advantage.

What innovative solutions do you hope to apply in the future to improve your services?

We plan to use e-commerce and mobile phone banking systems. In addition, we would like to adapt a hybrid mail solution, whereby digital data is later transformed into a physical document at distributed print centers. We also aim to implement a superior postal card program. These developments are all aimed at improving our financial services.

How are you preparing Kazpost for a possible IPO?

An IPO is a great way to develop our company. In that vein, we are working to develop our responsibilities and improve the quality of our services through investment from the banking and financial system, and through innovation programs. We realize that we have responsibilities to our clients in villages and big cities, and such social responsibility is a facet of our organization. We try to develop our income while maximizing our expenditures, and develop our business system before we launch our social IPO.