Paytm's parent company, One 97 Communications, has reportedly terminated over 1,000 employees across various units in recent months, according to a report by the Economic Times.
This move comes as part of a cost-cutting initiative by the publicly listed fintech firm, which is currently restructuring its various business segments.
The decision is expected to impact a minimum of 10 per cent of the total workforce. This development follows Paytm's withdrawal from small-ticket consumer lending and the 'buy now pay later' segment. The exit from these areas is a response to regulatory restrictions on unsecured loans imposed by the RBI.
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Disbursing loans of less than Rs 50,000 under Paytm Postpaid, the company founded by Vijay Shekhar Sharma is undergoing a significant shift. Faced with changes in the regulatory landscape, it is now aggressively entering the realms of wealth management and insurance broking.
Earlier this month, Paytm's stock experienced a 20 per cent decline, hitting the lower circuit. This followed the company's announcement that it would withdraw from Paytm Postpaid and adopt a cautious stance regarding small-ticket loans in the future.
According to sources mentioned in the report, a spokesperson from Paytm disputed the reported number of terminated employees but confirmed the occurrence of layoffs. The spokesperson emphasized the company's aim to reduce staff costs by 10-15 percent throughout the current fiscal year.
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The spokesperson also highlighted that many of the affected positions have been substituted with automation led by artificial intelligence.
Recently, Paytm appointed Bhavesh Gupta, who previously held the position of lending and payments chief, as the company's president, signaling a move to broaden its revenue streams.
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