10 Jun 2024

Paytm Lays Off Employees Amid Restructuring, Offers Job Placement Assistance, See Details

Paytm's parent company, One 97 Communications Limited, is laying off employees as part of a restructuring effort. The exact number of layoffs has not been disclosed by the company.

Media reports indicate that in the March 2024 quarter, the number of sales employees at Paytm decreased by about 3,500, bringing the total to 36,521. This reduction is largely attributed to the Reserve Bank of India's (RBI) ban on Paytm Payments Bank services.

Company Provides Job Placement Assistance

In a statement released on Monday, One 97 Communications Limited announced that it is providing outplacement support to employees who have resigned as part of the restructuring. This support helps the affected employees find new job opportunities.

Paytm Payments Bank Stops Accepting Deposits After March 15

On January 31, the RBI imposed significant business restrictions on Paytm Payments Bank, citing long-term non-compliance with regulatory requirements. An RBI circular initially stated that no deposits could be made into Paytm Payments Bank accounts after February 29, but this deadline was later extended to March 15. As a result, deposits into Paytm Payments Bank accounts, wallets, prepaid services, Fastag, and other services have ceased since March 15. 

The RBI found serious irregularities in Paytm's KYC processes, including incomplete KYC for millions of customers, multiple accounts using a single PAN, and providing incorrect information to the RBI. Additionally, a large number of inactive accounts were identified.

Paytm's Fourth-Quarter Loss Increases

One 97 Communications reported a loss of Rs 550 crore for the fourth quarter of the financial year 2023-24, a significant increase from the Rs 167.5 crore loss in the same quarter of the previous year, representing a 228% rise. 

The company's revenue also declined, with operational revenue dropping to Rs 2,267 crore in the January-March quarter from Rs 2,334 crore in the same period last year, marking a 3% annual decrease. The company released these results on May 21.

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