Paytm Parent staff costs rise 21% in challenging year

One 97 Communications (OCL), which runs digital payments platform Paytm, saw its overall employee costs grow 21% to Rs 4,589 crore in 202-24 from Rs 3,788 crore in FY23, amid regulatory clampdown in its associated entity. Paytm Payments Bank and slowdown in your overall business.

OCL increased the remuneration of its CEO and group CFO Madhur Deora by 15%, nearly double the organization-wide average increase, according to its FY24 annual report.

This increase was approved through a board resolution adopted by the company in September 2023 and the revised salary was approved till fiscal 2026. Responding to ET’s queries to pay The spokesperson said: “For eligible employees, the average percentage increase in remuneration in FY24 is 14% and the average increase in remuneration is 7%.”

The increase took Deora’s remuneration to Rs 3.6 crore in 2023-24, while his overall remuneration without employee stock options (Esops) stood at Rs 4.2 crore.

Vijay Shekhar Sharmafounder and CEO of OCL, did not take any increase in the last fiscal year, keeping his overall remuneration stable at Rs 4.4 million. The company said Sharma’s salary had been fixed for three years in fiscal 2022.

Deora’s salary increase, on top of a 9% increase in its remuneration in FY23, came in a year in which the company began a mission to rein in its bloated employee costs. ET reported in December 2023 that pay had laid off more than 1,000 employees. The company has set a target of reducing its employee overhead expenses by Rs 400-500 crore in the current fiscal year.

Commenting on the increase in employee costs, the company spokesperson said Paytm strengthened its merchant sales and financial services teams to drive penetration of their high-margin use cases, such as merchant underwriting and loan distribution.

“We are also investing in our product and technology team to help scale our platform and support the next stage of users and transactions,” the spokesperson added.

Since the beginning of the current financial year, given the regulatory actions on the banking business and the general turnover of the organization, a large number of senior executives have left OCL. Paytm’s chief business officers Bipin Kaul and Ajay Gupta have resigned following the departure of Bhavesh Gupta, the company’s chief operating officer. Surinder Chawla, CEO of Paytm Payments Bank, resigned in April.

On August 21 this year, Paytm adopted a resolution that its non-executive directors on the board of directors will not be paid more than Rs 48 lakh per annum, of which the fixed component will be Rs 20 lakh.

In the last fiscal year, the company’s share price fell from around Rs 600 in March 2023 to around Rs 400 in March 2024. Since then, the share price has appreciated to Rs 731.

To get its business back on track, Paytm is focusing on QR code payments through sound box. It recently launched the tap and pay feature on its sound boxes that are often used by small merchants to accept UPI payments via QR codes.

The company reported on August 28. to the stock exchanges that it has received permission for foreign direct investment in its subsidiary entity Paytm Payment Services and will reapply for the payment aggregator license to the Reserve Bank of India.

In the June quarter of the current financial year, Paytm reported operating income of Rs 1,501 crore and a net loss of Rs 840 crore.

Deora, previously a senior executive at Citibankhas been with Paytm since 2016, leading the finance functions. He was promoted to the position of group financial director in October 2020.