In his first direct address to the workforce since the RBI directive on January 31, Paytm founder Vijay Shekhar Sharma spoke to employees in a "confident and assuring" tone
A senior employee highlighted that Sharma's primary focus during the morale-boosting call was to dispel rumors of potential layoffs
Last week, RBI barred Paytm Payments Bank from any deposits or credit transactions, or top-ups in any of its customer accounts
Inc42 Daily Brief
Stay Ahead With Daily News & Analysis on India’s Tech & Startup Economy
In the wake of the ongoing crisis at fintech major Paytm, its founder Vijay Shekhar Sharma assured all its staff that there would be no layoffs and the company has been in talks with the Reserve Bank of India (RBI), besides, weighing partnership options with other banks.
“We are not completely sure of things…like what exactly went wrong. But we will figure out everything soon. We will reach out to the RBI to see what can be done,” Sharma said while addressing around 800-900 employees during an extensive hour-long virtual town hall, Moneycontrol reported.
In his first direct address to the workforce since the RBI directive on January 31, Paytm founder Vijay Shekhar Sharma spoke to employees in a “confident and assuring” tone. A senior employee highlighted that Sharma’s primary focus during the morale-boosting call was to dispel rumours of potential layoffs.
“It was a morale booster call to cut the rumours of layoffs. The majority of the talk was around job security and bank tie-ups. No single name was taken, but we were told that a lot of banks have approached,” the employee said.
It is pertinent to note that last week, the RBI barred Paytm Payments Bank from taking any deposits or credit transactions or top-ups in any of its customer accounts. The central bank also stopped Paytm Payments Bank from providing any other banking services, such as UPI facility and fund transfers after February 29, 2024.
While Paytm has issued multiple statements following that and said it’s working with the RBI to comply with the regulatory requirements, the entire fiasco has left many merchants and other customers of Paytm anxious.
Amid this, the Confederation of All India Traders (CAIT) has advised all the businesses and traders to switch from Paytm to other payment platforms for business-related transactions.
Amid heavy selling in the stock, the BSE and the NSE lowered Paytm’s circuit limits to 10% from 20% earlier. On Monday, the company’s shares opened 10% lower at INR 438.35 and were locked in the lower circuit limit.
Meanwhile, Paytm has also denied the report that it is in exploratory talks with a few companies, including Jio Financial Services, to sell its wallet business.
Calling the report a speculation, a source at Paytm said the company is not in any talks to sell its wallet business.
A Paytm Payments Bank spokesperson said, “We do not comment on any market speculation. We completely abide by the direction of the regulator, and the team’s effort is to ensure a smooth customer experience with the products offered by PPBL.”
Earlier, Hindu BusinessLine, citing sources, reported that Jio Financial Services and HDFC Bank are the leading contenders to acquire the wallet business of Paytm after the Reserve Bank of India’s (RBI’s) regulatory crackdown on its payments bank.
Following the report, shares of Jio Financial Services surged as much as 16.5% during the intraday trading on the BSE on Monday (February 5). However, shares of HDFC Bank did not witness any significant movement.
As per the media report, seven senior fintech and banking sector executives with knowledge of the development said that Paytm has been in talks with Jio Financial Services since November last year for a deal.
Note: We at Inc42 take our ethics very seriously. More information about it can be found here.