Prosus, the investment arm of South African multinational Naspers, is among the largest backers of Indian new-age internet companies including Swiggy, Byju’s, Meesho, among many others.
A person aware of the matter said the layoffs are spread across various teams and mainly impacted PayU India’s unit, Wibmo, a digital payment security and mobile payment technology firm it acquired in 2019 for $70 million.
PayU India’s fintech businesses include Wibmo, LazyPay and Citrus Pay.
“Keeping in mind our highest strategic priorities, we are realigning teams across some businesses in India,” a spokesperson for PayU said, confirming the development. “…we will have (to) part ways with some of our colleagues. Close to 150 employees, which is less than 6% of our total employee strength, will be impacted from organisational realignment.”
The spokesperson said that, as the company focuses on creating a full-stack digital financial services ecosystem in India, it was important to ensure that PayU had “the right structure and resources in place and is nimble enough to respond to a fast-evolving fintech market and seize the opportunities it presents.”
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The company did not have “any plans for any major downsizing”, the spokesperson added.
In October,
Prosus terminated its $4.7 billion acquisition of online payments gateway firm
BillDesk by
PayU Payments. The firm’s decision to pull out of the deal came barely a month after India’s anti-trust regulator – Competition Commission of India (
CCI) –
had approved the contours of the deal that was first announced in August 2021. The merger was expected to create an online payments gateway juggernaut that would process $147 billion in annualised total payments value (TPV), almost twice that of its nearest contender Razorpay, which processes $80 billion in annual TPV.
Earlier this year, the Reserve Bank of India ordered that prepaid payment instruments (PPIs) should not be loaded with credit lines. This had caused PayU India’s lending arm LazyPay to make changes in its business model around its card offering, LazyCard. In July, ET reported that
LazyPay had to suspend its buy-now-pay-later (BNPL) payment product LazyPlus UPI, amid rising regulatory scrutiny of card-based credit fintech firms.
For financial year 2021-22,
PayU Payments reported an over 50% year-on-year jump in consolidated revenue to Rs 2,130.2 crore. It also clocked in net profit of Rs 125.8 crore during the year. As for the year ended March 31, 2021, the company had reported Rs 1,415.67 crore in consolidated revenue, with net losses of Rs 114.6 crore.
Recently, Nykaa’s former finance chief
Arvind Agarwal joined PayU India as its chief financial officer. India is PayU’s largest market. This year, on account of a slump in venture funding, several startups including those in the fintech space have undertaken layoffs to reduce costs. These include gold loans provider Rupeek, which fired around 200 employees in June and Tiger Global-backed digital ledger platform OkCredit, which laid off 35-40 employees.
