Paytm, the digital payments firm owned by One97 Communications Ltd., has laid off at least 1,000 employees across various divisions as part of its efforts to reduce employee costs. The layoffs began in October and primarily affected the operations and marketing teams. The company stated that it is implementing artificial intelligence (AI) to automate repetitive tasks and roles, which will result in increased efficiency and cost savings of 10-15% on employee costs. Paytm plans to hire 15,000 employees in its core payments business in the coming year and expand into new business verticals such as insurance and wealth.
The decision to lay off employees and implement AI automation is not unique to Paytm. Many new-age companies have taken similar measures to cut costs and optimise tasks using AI-powered technologies. In the first three quarters of this year, a significant number of employees in the new-age financial company segment have lost their jobs.
The layoffs at Paytm come shortly after the company announced that it would scale back on small-ticket loans under its Buy Now, Pay Later (BNPL) offering, Paytm Postpaid, and focus on high-ticket loans. This decision caused a 20% drop in the company's shares as multiple brokerages expressed concerns about the negative impact of the move.
Despite the layoffs, Paytm remains committed to growth and innovation. The company intends to hire fresh talent to drive growth in new business segments and expand its presence on the payments platform. With its dominant position in the market and a profitable business model, Paytm aims to continue innovating for India.
Paytm has laid off employees to reduce costs and improve efficiency through AI automation. The company plans to hire new talent to drive growth in its core payments business and expand into new business verticals. These layoffs are part of a broader trend in the new-age financial companies segment, where companies are using AI-powered technologies to optimise tasks and cut costs.
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