Paytm began its round of layoffs about two weeks ago, coinciding with the Reserve Bank of India’s restrictions on Paytm’s Payment Bank, which have resulted in the suspension of several key business operations.
Additionally, the layoffs at Paytm have already commenced, with reports indicating that the company’s decision comes amidst regulatory constraints imposed by the RBI on Paytm’s Payment Bank, affecting its ability to conduct certain business activities.
According to reports, Paytm’s parent company, One 97 Communications, is set to carry out additional layoffs across various departments during its annual performance review. This move coincides with the Reserve Bank of India’s (RBI) recent restrictions on Paytm’s Payment Bank, which have led to the cessation of several business operations. Although the exact number of affected employees remains uncertain, sources cited by Moneycontrol indicate that certain departments have been instructed to reduce their team sizes by up to 20%.
The layoff process has already begun two weeks ago, the report added, citing a Paytm spokesperson who disputed the percentage of layoff and did not specify a number. The spokesperson said the company is in the middle of an annual appraisal cycle which could lead to job cuts.
We are in the midst of our annual appraisal cycle, a common practice across companies, where performance assessments may lead to adjustments based on performance evaluations and role suitability. It’s crucial to understand that this process is distinct from layoffs, a routine aspect of performance evaluations in any organization,” the spokesperson said in a statement as per the report.
The company is also focussing on implementing AI-powered automation in their operations, the spokesperson said, adding, “We continue to transform our operations with AI-powered automation to drive efficiency. This involves redefining certain roles and tasks to better align with our growth and cost-efficiency goals.
As per an unnamed Paytm employee quoted in the report, there are clear directives from the management to embark on a restructuring process aimed at reducing headcounts across different functions within the company. Employees are reportedly being summoned individually by the Human Resources department, where they are informed about the impending layoffs in a one-on-one setting. This personalized approach underscores the sensitivity and gravity of the situation for those affected.
Another Paytm employee revealed, “Yesterday, on March 12th, the department head personally communicated to me about the directive to reduce the workforce within our team. While it remains unclear whether this decision originated from the department head or higher management, the implementation is imminent. It’s worth noting that other verticals within the company have already begun similar initiatives. This additional reduction, speculated to be around 20%, is distinct from previous measures and is unrelated to individual performance evaluations.”