The coronavirus epidemic wreaked havoc on commercial operations and caused panic in industries. Reports of corporate layoffs are coming thick and fast. Zomato, Bounce, Curefit, and Treebo are just a few Indian startups that have allowed their workforce to grow enough to control costs and stay away from the cost crisis. The latest startup to follow suit in a wave of massive layoffs is fintech startup Lendingkart.
According to sources, Lendingkart is letting more than half of the nearly 500 employees in its offices in Ahmedabad and Bangalore leave with immediate effect. While the company is yet to make an official statement, some employees specifically spoke to OfficeChai and made us aware of Going-On. Employees have also claimed that no valid reason was given for their accidental termination, and the terms of compensation are unclear. There was no announcement by the CEO. I was told about a hangout call – so it cannot be recorded – asking me to voluntarily resign by 6pm today, or send a termination letter to the company, against two months’ pay. He said that the company would send someone to get our laptop. “A disgruntled employee on condition of anonymity. “We just want our work back. Even if they deduct a large part of our salary, which is fine, but we need some money to survive. He said that who would get the job even after the lockdown was facilitated? ”
Lendingkart was founded in 2014 by Harshvardhan Lunia and Mukul Sachan. The company describes itself as non-deposit in NBFCs, which eliminates SMEs and MSEs in India. The company has developed technology tools based on big data analysis that facilitate lenders to evaluate the creditworthiness of a borrower and provide other related services. The company has raised a total of $ 143 million in the last 6 years.
It is not clear to what extent Ladingkart’s business has been affected by the coronovirus lockdown. At a recent virtual summit on digital lending, the CEO of Lendingkart stated that the coronavirus virus epidemic actually served as a great opportunity for a digital lending business like his. “Business banks are unable to avail loans through personal visits to branches and hence digital. Firms have a clear opportunity. However, given the current rapidly evolving situation, all financial institutions are focusing on maintaining their liquidity and collections. “The government had freed banks and financial institutions from lockdown, but as the country’s economic slowdown and consumer demand declined, Lendingkart’s ability to generate enough demand to stay at its previous level was compromised.” Could. The company relies primarily on MSE lending – which has been brutally hit by India’s two-month lockdown – and its business has been badly affected. “We are continuing to get business leads from digital channel partners and small businesses applying for credit on our website which is about 70% of our total sourcing. For some time, we have decided to hold on until the epidemic is detected, but our technology platform-based credit assessment continues and we are accumulating this business later, as the world goes on. Ready to resume in the next 3-4 weeks. . ”, Sudeep Bhatia, Lendingkart CFO, said in a recent interview. It is somewhat strange and odd that the company needs to resort to giving away about half of its workforce, with abrupt and easily ambiguous communications to employees. “It is just a cost cutting measure. The company is still fully functioning. They only let people in operations and customer service. The manager or any of the top level executives have not been touched.
Lendingkart customers, on the other hand, have also been complaining on their social media that the company is not meeting the ban on EMI payments announced by the government in March to reduce the burden of debt servicing brought about the coronavirus virus Was.
While the coronovirus crisis has hampered the business of industries well, it is also said to question the rent ‘n’ policies of highly funded and celebrated startups. On the one hand an AirBnB announced last week to lay off 25% of its workforce, thoughtful communication and a generous compensation package and support for employees were greatly appreciated by its CEO – including affected employees. On the other hand, the latest development in Lendingkart – a startup that was haunting unicorn dreams until very recently – firing more than half of its employees in a proper way leaves much to be desired in India’s sacred startup dream.