An Post is to get a €40m euro loan from the European Investment Bank (EIB) over 10 years.
The money is to be used to drive its digital, retail and green transformation.
This is this first ever long-term EIB loan to Ireland's post office operator.
It is part of a strategy to diversify and modernise the company.
The new EIB-backed investment will allow more than 750 fully electric vehicles to be used for local deliveries across the country and digital customer services to be upgraded across the retail network - including 950 modernised post offices.
As well as Dublin, Zero Emission Electric Vehicles will be introduced to Cork, Galway, Kilkenny, Limerick, Waterford and other towns within 12 months.
An Post says customers will also benefit from high-performance automated parcel sorting and replacement of paper forms with app-based technology.
Announcing the funding, Communications Minister Richard Bruton said: "One of the challenges of climate action is the need to mobilise capital for new, sustainable technologies.
"Today's announcement allows an Post to be a leader in putting sustainability at the core of their business."
Andrew McDowell, EIB vice-president responsible for Ireland, said: "As a leading European postal services provider, An Post is demonstrating how support for local communities and climate action can be at the core of a sustainable business.
"For that reason, I am very pleased to confirm a new €40m loan from the European Investment Bank - the EU Bank - to finance its greener delivery fleet and to accelerate use of innovation and digitalisation to enhance access to financial services and improve mails, parcels and e-commerce services for customers".