In a strategic move towards efficiency and growth, Paytm’s parent company, One 97 Communications, has reportedly laid off over 1,000 employees from various departments in the last few months, impacting at least 10% of the company’s workforce. The layoffs are primarily attributed to the integration of AI-powered automation, aimed at streamlining operations, reducing costs, and fostering overall business development, as reported by The Economic Times.
The roles affected by these layoffs are those that can be automated through artificial intelligence, targeting repetitive tasks to enhance operational efficiency. Paytm, a leading player in the fintech industry, has been increasingly leveraging automation to optimize its business processes.
The fintech giant is actively redirecting its focus towards expanding its wealth management division and building a robust insurance distribution business. Earlier this year, Paytm’s CEO, Vijay Shekhar Sharma, highlighted the company’s commitment to advancing its AI capabilities, revealing plans to create an Artificial General Intelligence software stack.
“Paytm is investing in AI with an eye on building an Artificial General Intelligence software stack. We believe by building it in India we are not only making our country’s tech capability but also creating something that could be leveraged outside India,” stated Vijay Shekhar Sharma in a letter to shareholders, as mentioned in the Annual Report 2023.
In addition to the workforce restructuring, Paytm recently announced a shift in its lending strategy. The company will now concentrate on high-ticket lending for both consumers and merchants, scaling back on disbursing small-ticket loans less than Rs 50,000, commonly referred to as Postpaid loans.
The company provided insights into this decision in an exchange filing, stating, “On the back of recent macro development and regulatory guidance, in consultation with lending partners, in line with its continued focus on driving a healthy portfolio, the company has recalibrated the portfolio origination of less than Rs 50,000, which is prominently the postpaid loan product.” It further added that this category “will now be a smaller part of its loan distribution business going forward.”
