Paytm Layoffs: Digital Payment Firm Warns Job Cuts By 20%

With plans to reduce employee cost, digital payments firm Paytm might cut around 15-20 per cent of its workforce in the current financial year.

The average cost per employee stood at Rs 7,87,000. In FY24, the total expenditure surged by 34 per cent year-on-year to Rs 3,124 crore, and the average employee cost is estimated to have increased to Rs 10,60,000.

In light of mounting losses, Paytm has initiated an employee cost reduction plan targeting to save Rs 400-500 crore. This could potentially result in a reduction of 5,000-6,300 employees.

The Paytm CEO had hinted at reducing operational costs, which included leveraging AI for a more efficient organisational structure.

The company believes that optimising cost structure, leveraging artificial intelligence capabilities, and focusing on core business will help achieve significant cost efficiencies.

The process of downsizing is already underway, with over 1,000 employees reportedly terminated in December to streamline operations and cut costs.

The net loss for Paytm widened to Rs 550 crore in Q4 FY24 from Rs 168 crore a year ago, attributed to a decline in revenue.

However, Paytm remains committed to advancing high-performing individuals by promoting them to leadership positions and recruiting new senior executives to drive growth.

Trouble for the fintech company began on Jan, when the RBI prohibited Paytm Payments Bank from accepting additional deposits and top-ups, and from conducting credit transactions in customer accounts, among other restrictions.