New Delhi:

PhonePe CEO and co-founder Sameer Nigam has opposed the Karnataka government’s private jobs quota bill, which aims to reserve a significant portion of jobs in the private sector for locals.

In a post on X, Mr Nigam, who said he has created over 25,000 jobs across India through his companies, argued that the bill was unfair to people like him who have lived in multiple states due to their parents’ work.

“I am 46 years old. Never lived in a state for 15+ years. My father worked in the Indian Navy. Got posted all over the country,” he wrote on X.

He questioned the bill, asking whether his children, who have grown up in Karnataka, “don’t deserve jobs in their home city,” despite him creating employment opportunities all over the country.

“Shame,” he added.

I am 46 years old. Never lived in a state for 15+ yrs

My father worked in the Indian Navy. Got posted all over the country. His kids don’t deserve jobs in Karnataka?

I build companies. Have created 25000+ jobs across India! My kids dont deserve jobs in their home city?

Shame.

— Sameer.Nigam (@_sameernigam) July 17, 2024

What Is Karnataka Job Quota Bill?

The Karnataka State Employment of Local Candidates in the Industries, Factories and Other Establishments Bill, 2024, was proposed on July 16. The bill mandated reserving 50 per cent of management-level jobs and 70 per cent of non-management-level jobs for locals.

State Industries Minister M B Patil said that the policy aims to protect the interests of Kannadigas while also considering the needs of industries.

IT Minister Priyank Kharge said that the bill’s primary objective is to create more job opportunities for locals.

Why Karnataka Job Quota Bill Is Being Opposed

Industry stakeholders believe the bill could have far-reaching consequences for the state’s economy, startups, and IT companies. The industry body NASSCOM said that the restrictions could drive startups and IT companies out of the state, leading to a loss of investment and jobs.

The bill could lead to a scarcity of skilled talent in the state, as companies may struggle to find local candidates with the required skills, as per reports.

TV Mohandas Pai, the partner at Arin Capital and former CFO of Infosys, called the bill “regressive, unnecessary, draconian, unconstitutional, and illegal”.

Biocon chairperson Kiran Mazumdar-Shaw said that the bill could hurt the state’s leading position as a tech hub, adding it may affect the availability of skilled talent. While IT giants may have the resources to shift to neighbouring states, smaller players based in Bengaluru may not have the same option, which could lead to a disadvantage for them.

Following this severe backlash, the bill has now been put on hold.

New Delhi:

India will again delay caps on market share for a popular digital payments method, two sources told Reuters, benefiting Google Pay and Walmart-backed PhonePe as the authorities prioritise growth over concerns about market concentration.

The National Payments Corporation of India (NPCI), the quasi-regulator, will extend by as much as two years a year-end deadline to cap at 30% the market share of any company processing payments via the Unified Payment Interface (UPI), the sources with direct knowledge of the matter told Reuters.

PhonePe’s share of UPI payments has risen to 48.3% from 37% in April 2020, while Google Pay’s share has declined to 37.4% from 44%, according to NPCI data. The two processed a combined 11.5 billion transactions in April, the data showed.

NPCI and Google Pay declined to comment. PhonePe did not respond to an email seeking comment.

India launched UPI in 2016 but barred companies from charging for the instant digital payments service in an effort to promote online transactions and reduce the use of cash in Asia’s third-largest economy.

Because they cannot charge for it, India’s banks and others like Meta-owned WhatsApp and Amazon Pay have not pushed UPI-based payments aggressively, leaving authorities worried about a concentration risk.

While their apps do not earn money from the payments, PhonePe and Google Pay have been able to use their UPI customer base to sell services such as loans and insurance.

NPCI, which has a regulatory mandate from the central bank, announced the 30% cap in 2020 but later extended the deadline by two years to the end of 2024.

The deadline will have to be extended again, said one of the sources, as it is not possible for PhonePe and Google Pay to reduce their market shares without hurting UPI payments growth.

A final decision on the extension will be communicated closer to the deadline, said the sources, who asked not to be identified because they are not allowed to speak to the media.

NPCI had hoped for more competition when WhatsApp was permitted to offer UPI-based payments in February 2020, but the company had just 0.2% market share as of April.

India’s Paytm, with the third-highest share, has experienced a decline in payments processed through its platforms after regulators placed curbs on a group entity.

Payment firms want the market-share cap removed, asking NPCI to let them charge for UPI payments to encourage competition, said an official at a payment company.

The government will decide whether to allow firms to charge for UPI payments, the two sources said, but one said NPCI does not favour removing the share cap.

The volume of UPI transactions rose 49.5% in April from a year earlier, less than the 54% rise logged March.

The central bank met on Tuesday with industry executives to brainstorm on ways to expand the UPI user base, which was about 300 million users and 50 million merchants late last year, according to the most recent data.

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