Paytm's parent company, One97 Communications, has significantly trimmed its workforce, reducing headcount by 4,500 in FY25. This strategic move helped the fintech giant save ₹650 crore in employee expenses, surpassing initial savings estimates of ₹400-500 crore, as revealed in its latest annual report released on August 6.
The average employee strength dropped from 44,000 in FY24 to 39,400 in FY25, driven by Paytm’s focus on building a leaner, tech-driven organizational structure. Despite workforce reductions, the company continues to invest in expanding its sales and distribution network.
In FY25, Paytm’s employee expenses (excluding ESOP costs) fell 21% to ₹2,473 crore, down from ₹3,124 crore in FY24. However, this is still marginally higher than FY23’s figure of ₹2,323 crore.
“Our focus on efficiency and cost optimization has helped preserve and grow our cash reserves. This positions us firmly on the path to sustainable growth and profitability,” said CEO Vijay Shekhar Sharma in a letter to shareholders.
🔻 Business Challenges and Recovery Path
The decision to reduce expenses comes in the wake of operational challenges posed by the Reserve Bank of India’s (RBI) restrictions on Paytm Payments Bank Ltd (PPBL), an associate entity, during Q4 FY23. These restrictions disrupted key product offerings including wallets, Fastags, and savings accounts, and also impacted the lending vertical.
The December quarter of FY24 marked a peak for Paytm with its highest-ever quarterly revenue of ₹3,000 crore. However, by the June quarter of FY26, revenue fell by 30% to ₹2,150 crore. Major operational expenses also dropped 38%, from ₹3,200 crore in Q3 FY25 to ₹2,000 crore in FY26 Q1.
