The logo of the Paytm app. File
| Photo Credit: Reuters

Fintech firm One97 Communications, owner of the Paytm brand, is laying off an undisclosed number of employees and claimed that it is providing outplacement support for their smooth transition, according to a company statement.

Paytm’s sales employee headcount in the March 2024 quarter dropped by about 3,500 to 36,521 personnel on a quarter-on-quarter basis, mainly due to the impact of the Reserve Bank of India’s (RBI) ban on services of Paytm Payments Bank.

“One97 Communications Limited (OCL) is providing outplacement support to employees who have resigned as a part of the restructuring efforts by the company. The company’s human resource teams are actively collaborating with over 30 companies that are currently hiring, and providing assistance to employees who have opted to share their information, facilitating their immediate outplacement,” the company said on June 10.

Paytm did not disclose the number of employees impacted by the restructuring. “Paytm is also disbursing bonuses which were due to employees, ensuring fairness and transparency in the process,” the statement said.

Paytm has reported a widening loss to ₹550 crore in January-March 2024, after the baned transactions related to its payments bank.

The RBI had barred Paytm Payments Bank Limited (PPBL) from accepting deposits, credit transactions or top-ups in any customer accounts, wallets, and FASTags, keeping in view the interest of customers, including merchants from March 15 onwards.

The company had posted a loss of ₹167.5 crore in the same period a year ago. “As part of its FY24 earnings release, One97 Communications stated that it will be pruning its non-core business lines, and will continue its efforts to maintain a leaner organisation structure through AI-led interventions. The company has been actively working towards driving profitability, in line with its guidance,” the statement said.

New Delhi:

Digital payments firm Paytm posted a wider loss in the fiscal fourth quarter on Wednesday, hurt by weakness in its payments and financial services business after the central bank shut down its banking unit.

The company’s consolidated net loss was at Rs 5.5 billion as it took an impairment of Rs 2.27 billion towards scaling down the business of Paytm Payments Bank.

Paytm had reported a loss of Rs 1.68 billion a year ago in the March-quarter.

Meanwhile, its consolidated revenue from operations fell to Rs 22.67 billion ($272.3 million) for the January-March quarter from Rs 23.35 billion a year earlier.

The Reserve Bank of India had ordered Paytm Payments Bank, an associate of Paytm, to stop accepting fresh deposits in its accounts or digital wallets from March, raising concerns about revenue from the company’s main payments business.

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)

Surinder Chawla. File photo: paytmbank.com

Beleaguered Paytm Payments Bank’s managing director and CEO Surinder Chawla has resigned from the company, a regulatory filing said on April 9.

Mr. Chawla’s resignation comes amidst Paytm Payments Bank facing prohibitory action from banking regulator RBI.

Also read: The Paytm Payments Bank debacle | Explained

“Surinder Chawla, Managing Director and CEO of PPBL, has tendered his resignation on April 8, 2024, on account of personal reasons and to explore better career prospects. He will be relieved from PPBL w.e.f. close of business hours on June 26, 2024, unless changed by mutual consent,” One97 Communications, Paytm brand owner, said in a regulatory filing.

Mr. Chawla joined PPBL in January last year after the payments bank received approval from the Reserve Bank of India.

In a major action against Paytm Payments Bank (PPBL), RBI, on January 31, directed it to stop accepting deposits or top-ups in any customer accounts, wallets, FASTags and other instruments after February 29. Subsequently, the deadline was extended to March 15.

The direction follows persistent non-compliance and continued material supervisory concerns, the central bank had said in a statement.

On March 11, 2024, the RBI barred PPBL from onboarding new customers with immediate effect.

Following regulatory actions, promoter Vijay Shekhar Sharma last month stepped down as part-time non-executive Chairman of Paytm Payments Bank Limited, and the board of the bank has been reconstituted.

Former Central Bank of India chairman Srinivasan Sridhar, former Bank of Baroda Executive Director Ashok Kumar Garg, and two retired Indian Administrative Service (IAS) officers were inducted on the board of the bank.

One97 Communications Limited (OCL) holds a 49% stake in PPBL.

Paytm said nearly all agreements between the company and PPBL have been terminated as per a disclosure on March 1, 2024, and the board of PPBL has been reconstituted with five independent directors including an independent chairperson, and no nominees from the company, as per its disclosure on February 26, 2024.

“In line with our ongoing efforts, the company continues to collaborate with banking partners to enhance our merchant acquiring and UPI services,” the filing said.

The National Payments Corporation of India on Thursday granted One97 Communications Ltd the approval to participate in UPI as a Third-Party Application Provider (TPAP) under the multi-bank model.

Axis Bank, HDFC Bank, State Bank of India, and YES Bank will act as Payment System Provider (PSP) banks to Paytm.