The interface of Indian payments app Paytm is seen in front of its logo displayed in this illustration picture.
Credit: Reuters File Photo
Paytm, the fintech major, has let go of 1,000 employees from its sales, operations, and engineering teams even as the company implemented AI technology to boost efficiency.
In 2021, the company had let go of 500 to 700 workers for non-performance.
Speaking to Moneycontrol, a Paytm spokesperson said "We are transforming our operations with AI-powered automation to drive efficiency, eliminating repetitive tasks and roles to drive efficiency across growth and costs, resulting in a slight reduction in our workforce in operations and marketing. We will be able to save 10-15 per cent in employee costs as AI has delivered more than we expected it to. Additionally, we constantly evaluate cases of non-performance throughout the year."
The individual continued "Insurance and Wealth will be a logical expansion of our platform, in continuation of our focus on the existing businesses. Having shown the strength of our distribution-based business model in loan distribution, we are expanding the same to focus on new businesses to drive scale."
The publication, citing sources, further reported that the layoffs will hit the lending team.
Though Paytm's lending business is doing well, there is pressure to reduce costs, the report noted. The team size is said to be too big, accounting more than 30 per cent of total employees and RBI's new guidelines on consumer lending may force Paytm to layoff more people.
In November, Reserve Bank of India (RBI)'s tightened norms for unsecured personal loans for banks and non-banking financial companies. This forced Paytm closed short-term small personal loans and Buy-Now-Pay Later (BNPL) services.