According to a report, One97 Communications, the parent company of Paytm, is considering job cuts in an effort to reduce employee costs for the current fiscal year. The company is reportedly planning to reduce its workforce by about 15-20%, which could amount to approximately 5,000-6,300 employees. This move is part of One97 Communications’ strategy to save ₹400-500 crore.
Number of Employees at One97 Communications
As of the previous fiscal year (FY23), One97 Communications had an average of 32,798 employees on its payroll, with 29,503 actively working. However, in FY24, the total employee costs increased by 34% year-on-year, reaching ₹3,124 crore.
Reduction Process and Cost-Cutting Measures
The process of reducing the workforce has already begun, with over 1,000 employees reportedly terminated in December. This is part of One97 Communications’ efforts to streamline operations and cut costs.
Paytm’s Financial Performance
Paytm, a subsidiary of One97 Communications, reported a net loss of ₹550 crore in the January-March quarter, compared to ₹168 crore in the previous year. Additionally, the company’s revenue from operations declined by 3% year-on-year to ₹2,267 crore in the same quarter. This decline in revenue can be attributed to the restrictions imposed on Paytm Payments Bank by the Reserve Bank of India (RBI).
Vijay Shekhar Sharma’s Response
Vijay Shekhar Sharma, the founder of Paytm, acknowledged the impact of the RBI’s regulatory actions on the company’s revenue and profitability. He mentioned that Paytm has learned from these experiences and is committed to becoming better and more resilient. Furthermore, he expressed their dedication to full compliance with the expectations of regulators in both letter and spirit.
