When you buy through affiliate links in our content, we may earn a commission at no extra cost to you. Learn 
Paytm, the frontrunner in India’s digital payment sector, has hinted at potential layoffs and the possibility of downsizing non-essential assets following its unprecedented sales slump.
Paytm’s parent, One 97 Communications, disclosed a net loss of $66.1 million for the quarter ending March 2024. This is quite a significant loss compared to the $20.11 million loss reported in the same period last year. The company’s revenue also dropped about 3%, falling to $272.4 million from $280.4 million.
This latest development is not unconnected to the Reserve Bank of India’s (RBI) regulatory crackdown, which had Paytm shares fall by 20% in February.
As reported by Reuters, the RBI imposed a ban on Paytm’s affiliate, Paytm Payments Bank, prohibiting it from carrying out any banking activities from March onwards. This disruption in Paytm’s banking services compelled the company to forge new alliances with other banks to maintain its services.
The RBI intervened due to the company’s continuous non-adherence to regulatory norms. The regulator took action after providing some time for compliance. The RBI reportedly identified several issues, including instances where a single PAN card was linked to multiple accounts, a lack of KYC for numerous accounts, and breaches of KYC-anti-money laundering rules.
Despite these hurdles, Paytm’s annual revenue for the year ending March saw a 25% increase, reaching $1.19 billion. However, escalating payment processing charges, marketing expenses, employee benefit costs, and software cloud expenses have strained its net income.
In the early hours of today, the company’s shares fell by about 1% to ₹349.20, resulting in a market cap of $2.64 billion. However, it has made a slight resurgent, floating around ₹369.85.
