As the string of layoffs in 2023 continues, Paytm’s parent company One 97 Communications has decided to fire over 1,000 employees across various departments in an effort to cut costs across the company, reported the Economic Times.
Paytm is in the process of realigning various businesses and thus, is looking to cut costs, reported ET. This means that there could be more layoffs across the company in the coming months. The layoffs have all taken place over the last few months.
This means that over 10 per cent of the entire workforce at Paytm will be impacted by this move. This move also comes on the heels of thr UPI platform’s withdrawal of small-ticket consumer lending and its “buy now pay later” lending segment.
After over 1000 job cuts, the layoffs in Paytm have become one of the biggest layoffs in a new-age tech firm in India. Startup companies have been leading in layoffs across India this year, cutting thousands of jobs amid lack of funding and economic restructuring of the company.
The majority of the job cuts in Paytm are likely to be from its lending business, which has seen exponential growth over the last year, said ET citing sources. Paytm Postpaid usually grants loans smaller than ₹50,000, but is soon making its way towards wealth management.
However, Paytm’s stock took a major hit this year, falling around 20 per cent on December 7. The steep fall in the stock came after the company announced that it will be pulling the Paytm Postpaid loan plan.
Layoffs across startup companies in India
Not just Paytm, but newer tech startups have accounted for the most number of job cuts across the country this year. Data from Longhouse Consulting shows that new companies sacked around 28,000 people this year.
The layoff rates have risen exponentially as compared to the last two years, as only 4,080 people were laid off from these companies in 2021, and 20,000 people laid off in 2022. Majority of the 28,000 people were laid off just in the span of six months.
While PhysicsWallah, Udaan, Third Wave Coffee and Bizongo had extremely high layoff rates this year, firms like Flipkart and Byjus decided not to give appraisals this year to its top performers.