One 97 Communications, the parent company of Paytm, has laid off over 1,000 employees, impacting various departments such as payments, lending, operations, and sales. The move aims to optimize operations, reduce staff costs by 15%, and enhance profitability. The decision, made over the past few months, is attributed to performance-related concerns and reflects broader challenges faced by companies in the new economy sector.
This sector has witnessed over 28,000 job cuts in the first three quarters of the year, indicating financial difficulties and a tougher fundraising environment. Paytm’s restructuring aligns with the industry trend, particularly in its lending business.
While a Paytm spokesperson disputed the reported number of job cuts, they confirmed the ongoing changes. The company aims to reduce staff costs by 10-15% in the current fiscal year. To minimize the impact on employees, Paytm is actively implementing AI-led automation to fill certain roles, especially in areas affected by the layoffs.
Simultaneously, the company reportedly aims to fortify its core payments business by recruiting around 15,000 employees in the upcoming year. The spokesperson underscored Paytm’s dedication to developing new products in its wealth management sector and expanding its footprint in the insurance distribution business, foreseeing the creation of new job opportunities in these strategic domains.
As Paytm adapts to these changes, it strives to maintain a delicate equilibrium between cost optimization and growth, positioning itself for long-term sustainability in the dynamic financial services sector. Currently, it remains unclear whether the company provided severance pay to the laid-off employees or those facing imminent termination.