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Paytm Payments Bank to cut about 20% of staff as business halt looms

VCCircle

VCCircle · 1y ago

Paytm Payments Bank to cut about 20% of staff as business halt looms

Indian digital payments firm Paytm Payments Bank is expected to cut nearly 20% of its workforce as the future of the unit remains uncertain. The Reserve Bank of India has ordered the bank to halt most operations by 15 March, following compliance breaches. Paytm Payments Bank, of which Paytm owns a 49% stake, had 2,775 employees as of December 2023. Paytm shares have dropped 54% in value since the regulatory clampdown, and employees are reportedly frustrated after being told there would be no layoffs.

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Paytm crisis: PhonePe makes hay, user base climbs 15-20%

Economic Times

Economic Times · 1y ago

Paytm crisis: PhonePe makes hay, user base climbs 15-20%

PhonePe, the Walmart-owned payment platform, has witnessed a 15-20% increase in its user base, benefiting from the ongoing crisis at rival Paytm. Concerned about the fate of Paytm Payment Bank-issued UPI accounts, consumers are flocking to PhonePe. The surge in user numbers is expected to continue as the February 29 deadline approaches for Paytm Payments Bank to halt its services. PhonePe is also seeing faster growth on the merchant side and is preparing its systems to handle the additional capacity.

‘Should have done better … now learnt the lesson,’ says Paytm founder

Economic Times

Economic Times · 1y ago

‘Should have done better … now learnt the lesson,’ says Paytm founder

Paytm Founder and CEO, Vijay Shekhar Sharma, admitted that the company could have fulfilled its responsibilities in a better manner, in response to the Reserve Bank of India's order for Paytm Payments Bank to halt its banking services. Sharma compared the situation to a daughter on her way to an important test, but met with an accident and is now in intensive care. Paytm's parent company, One 97 Communications, reported a threefold increase in net loss and a decline in operating revenue due to regulatory action against the payments bank. Paytm Payments Bank's wallets business came to a halt as a result of the central bank's action. The company's stock has also taken a hit since the order.

Paytm shares crash 20% after RBI damages reputation, brokers downgrade

Economic Times

Economic Times · 1y ago

Paytm shares crash 20% after RBI damages reputation, brokers downgrade

Shares of Paytm, owned by One 97 Communications, tumbled 20% on the stock market after the Reserve Bank of India (RBI) ordered Paytm Payments Bank to halt new credit and deposit operations. Global broking firm Jefferies downgraded the stock and reduced the target price to Rs. 500, citing reputational concerns and the potential impact on the wallet and merchant payments businesses. Paytm expects the RBI measures to have a worst-case impact of Rs. 300 to 500 crores on its annual EBITDA.

ED, Authorities Have Been Sending Notice, Request To Paytm For Info On Customers: OCL

OutlookIndia

OutlookIndia · 1y ago

ED, Authorities Have Been Sending Notice, Request To Paytm For Info On Customers: OCL

Paytm and its banking arm Paytm Payments Bank have been receiving notices and requests for information from authorities, including the Enforcement Directorate (ED), regarding their customers. Paytm clarified that its associate, Paytm Payments Bank Limited, does not facilitate outward foreign remittances. The statement comes amidst a decline in Paytm shares after reports of a preliminary inquiry by the ED into alleged violations of the Foreign Exchange Management Act (FEMA) by Paytm Payments Bank. Earlier, the RBI had instructed Paytm Payments Bank to halt accepting deposits or top-ups in customer accounts.

SBI happy to welcome merchants looking to shift from Paytm bank: Dinesh Khara

Economic Times

Economic Times · 1y ago

SBI happy to welcome merchants looking to shift from Paytm bank: Dinesh Khara

State Bank of India (SBI) is offering support to merchants following regulatory action against Paytm Payments Bank. SBI Chairman Dinesh Khara stated that the bank is reaching out to merchants and is open to a one-time migration of accounts from Paytm. SBI Payments, a company that supports various payment systems, aims to ensure there are no disruptions in the payments ecosystem. The Reserve Bank of India (RBI) recently directed Paytm Payments Bank to halt basic payment services due to violations of rules, including KYC requirements. Paytm is reportedly in talks with HDFC Bank, Axis Bank, and Yes Bank to transfer its payments and settlements load.

Paytm's revenues to fall 65% post-RBI directive: Macquarie

The Arc Web

The Arc Web · 1y ago

Paytm's revenues to fall 65% post-RBI directive: Macquarie

According to estimates by brokerage house Macquarie, Paytm's overall revenues could drop to Rs 4,200 crore by March 2025, with losses more than doubling to Rs 3,400 crore. Macquarie also warns of a potential customer exodus, which could threaten Paytm's monetization and business model. The Reserve Bank of India (RBI) has ordered Paytm Payments Bank to halt UPI payments and fund transfers starting February 29, adding to the challenges faced by Paytm. Macquarie has lowered its share price target for Paytm and highlighted a slowdown in its lending operations.

Paytm Likely To Cut 20% Workforce As Part Of Annual Performance Review

Inc42 · 1y ago

Paytm Likely To Cut 20% Workforce As Part Of Annual Performance Review

Indian fintech giant Paytm is reportedly preparing to cut jobs as part of its annual performance review process. The move comes after the Reserve Bank of India (RBI) recently imposed restrictions on the company's payments bank, preventing it from conducting certain activities. Paytm has not confirmed the number of employees affected, but it is believed that some departments have been asked to reduce their teams by as much as 20%. In addition to the job cuts, Paytm is also focusing on incorporating AI-powered automation into its operations.

Paytm to staff: focus on moving business to other banks

Economic Times

Economic Times · 1y ago

Paytm to staff: focus on moving business to other banks

Paytm's leadership held townhall meetings to address concerns and reassure employees about the future of the fintech firm following the RBI's decision to halt basic banking services by the Paytm Payments Bank. The company is working on shifting its backend bank accounts to other banking partners, including Yes Bank, Axis Bank, and HDFC Bank. Paytm employees are facing uncertainty and challenges, while the leadership aims to ensure minimal inconvenience to users during the transition. The company is also planning to expand third-party bank partnerships for payment and financial services distribution.

Paytm not in list of 32 banks authorised to issue new FASTags

Economic Times

Economic Times · 1y ago

Paytm not in list of 32 banks authorised to issue new FASTags

The Indian road tolling authority has excluded Paytm Payments Bank from the list of 32 authorized banks to issue new FASTags. This move comes after the Reserve Bank of India barred Paytm Payments Bank from offering services starting in February. With over 20 million Paytm FASTag users, the government is concerned about the inconvenience they may face. Paytm FASTags will become inoperative from February 29, and users are advised to purchase new RFID stickers from the authorized banks listed by the Indian Highways Management Company.

Paytm shares hit fresh record low, down 24% this week alone

Economic Times

Economic Times · 1y ago

Paytm shares hit fresh record low, down 24% this week alone

Shares of Paytm, the fintech company, fell to a new record low of Rs 318.05 on NSE, losing about 24% of its market value in a week. The RBI ban on Paytm Payments Bank has impacted the company's business, and the road tolling authority has advised users to buy FASTags from authorized banks excluding Paytm Payments Bank. The Enforcement Directorate has initiated an inquiry against Paytm Payments Bank. RBI Governor Shaktikanta Das stated that there will be no review of the decision on Paytm Payments Bank. Experts suggest retail investors stay away from the stock until regulatory hurdles are resolved. Macquarie predicts the stock could slump to Rs 275.

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