SUMMARY
- Paytm’s parent company OCL saw a 21% increase in its total employee expenses, rising to Rs 4,589 crore in FY24 from Rs 3,788 crore in FY23.
- OCL had decided to increase the salaries of its executive director and group chief financial officer, Madhur Deora, by 15%.
- Founder and CEO of OCL, Vijay Shekhar Sharma maintained his total compensation at Rs 4.4 crore.
Fintech Paytm’s parent company, One 97 Communications (OCL), saw a 21% increase in its total employee expenses, rising to Rs 4,589 crore in FY24 from Rs 3,788 crore in the fiscal year 2022-2024, following a regulatory crackdown on its subsidiary Paytm Payments Bank and a slowdown in its primary business activities.
To address this, OCL decided to increase the salaries of its executive director and group chief financial officer, Madhur Deora, by 15%, a move that was nearly double the average increase across the organization, as per its annual financial report for FY24.
This salary increase was approved by the company’s board in September 2023, with the new salary set to be in effect until the financial year 2026. “For eligible employees, the average percentage increase in remuneration in FY 24 is 14% and the median increase in remuneration is 7%,” shared a Paytm spokesperson.
As a result, Deora’s total compensation for the fiscal year 2023-2024 reached Rs 3.6 crore, with his total compensation excluding employee stock options (Esops) amounting to Rs 4.2 crore.
Founder and CEO of OCL, Vijay Shekhar Sharma, chose not to receive a salary increase in the previous fiscal year, maintaining his total compensation at Rs 4.4 crore. The company stated that Sharma’s salary had been established for three years in the fiscal year 2022.
The salary increase for Deora, which was on top of a 9% raise in his compensation for the fiscal year 2023, occurred during a period when the company initiated efforts to manage its rising employee costs. As of December 2023, Paytm had let go of over 1,000 employees during this time. The company has set a goal to reduce its overall employee expenses by Rs 400-500 crore in the current fiscal year.
Deora, who had previously served as a senior executive at Citibank, joined Paytm in 2016 and took over the finance department. He was promoted to the role of group CFO in October 2020.
In response to the increase in employee costs, the company’s spokesperson noted that Paytm had strengthened its merchant sales and financial services divisions to enhance the adoption of its high-margin services, including merchant subscriptions and loan distribution.
Since the beginning of the current fiscal year, due to regulatory actions on the banking sector and a significant turnover among senior executives, a large number of top-level employees have left OCL. This included the resignations of Paytm’s chief business officers Bipin Kaul and Ajay Gupta, following Bhavesh Gupta’s departure as the chief operating officer of the company. Surinder Chawla, the CEO of Paytm Payments Bank, also stepped down in April.
In August, Paytm adopted a policy that its non-executive directors on the board would not receive remuneration exceeding Rs 48 lakh per year, with a fixed component of Rs 20 lakh.
On August 28, the company reported to the stock exchanges that it had received approval for a foreign direct investment into its subsidiary, Paytm Payment Services, and would reapply for the payment aggregator license from the Reserve Bank of India.
During Q1 FY25, Paytm reported operational revenue of Rs 1,501 crore and a net loss of Rs 840 crore.
