The layoffs follow the company's withdrawal from small-ticket consumer lending and the buy now, pay later (BNPL) segment after the Reserve Bank of India (RBI) tightened regulations on unsecured loans. Paytm is also revamping its wealth management operations and plans to hire over 15,000 contract salespeople to expand its merchant network. These changes, along with cost reductions from AI automation, could lead to profitability within the next year, according to Vijay Shekhar Sharma, founder and CEO of both One 97 Communications and Paytm.
Key takeaways:
- Paytm has confirmed a "slight reduction" in its workforce, but denied reports that it could cut more than 1,000 roles. The exact number of jobs to be cut was not specified.
- The company expects to save 10% to 15% in employee costs due to the successful implementation of artificial intelligence (AI) in its operations.
- Paytm is overhauling its operations and aims to achieve its first net profit since going public in November 2021. The company also plans to hire more than 15,000 contract salespeople to expand its merchant network.
- The company's shares dropped about 30% after the Reserve Bank of India (RBI) announced a crackdown on unsecured consumer loans, which led to Paytm withdrawing from small-ticket consumer lending and the buy now, pay later (BNPL) segment.