Indian fintech platform Paytm has reportedly trimmed its workforce amid costs cutting measures to realign various businesses. According to a report by The Economic Times, the layoff took place over the last few months.
ET reported that the company has axed over 1,000 jobs, affecting at least 10% of the total workforce, at multiple units. However, the One 97 Communications-owned company denied slashing more than 1,000 roles and confirmed a “slight reduction” in its workforce. Paytm further pointed out that its will be able to save 10-15% in staff costs over the course of current fiscal year as Artificial Intelligence has delivered more than expected.
Furthermore, the company is transforming its operation with AI-powered automation and aims to enhance efficiency by eliminating repetitive tasks, particularly within the operations and marketing departments, resulting in a modest downsizing of the workforce in these areas. This cost-cutting measure predominantly affects roles across payments, lending, and executive positions in operations and sales. The layoffs are primarily attributed to performance-related issues, aligning with Paytm’s focus on improving profitability.
Simultaneously, Paytm is venturing into new business arenas, focusing on the development of products for wealth management and establishing a robust insurance distribution network. And, these initiatives necessitate the recruitment of new talent, even as the company scales down some of its existing teams. According to Reuters, citing Paytm’s annual report, the company had an average of 32,798 directly employed staff and 1,589 contracted employees worldwide during the fiscal year to end-March 2023.
Meanwhile, the latest development follows the company’s decision earlier this month to scale down its buy-now-pay-later (BNPL) product, Paytm Postpaid, that comprise of small-ticket loans of less than Rs 50,000. This decision comes as a response to recent regulatory changes and a strategic shift towards a more cautious approach in the small-ticket loan sector. The company plans to now focus on the expansion of its portfolio of higher-ticket personal and commercial loans.