- Singapore’s Tonik Digital Bank lays off employees to boost revenue, profitability.
- Cuts target non-essential roles as lending products reach unit profitability.
- Pivoting resources to growth areas, aiming for group profitability in 2023.
Staff reductions
Singapore-based Tonik Financial, operator of the Tonik Digital Bank in the Philippines, recently laid off a number of employees in an effort to boost revenue and achieve profitability.
The exact number affected was not disclosed, however a source stated about 80 positions were impacted across various units.
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Non-essential fixed positions targeted
According to founder and CEO Greg Krasnov, the job cuts targeted non-essential fixed positions. He stated that the company’s lending products have reached unit profitability, and Tonik is now focused on attaining group profitability.
Last year, Tonik increased its consolidated loan portfolio by 201% and headcount by 45%, while reducing net cash burn by 33%. However, it still posted $37.6 million in total comprehensive losses for 2022.
Krasnov intends to redeploy resources into areas directly supporting growth. He projects further improvements in Tonik’s loan portfolio and revenue this year, expecting a double-digit percentage increase in overall headcount by year-end.
Pivot towards profitability
Launched in 2021, Tonik Financial had nearly 600 employees in January 2023. As Krasnov previously commented, successfully minimizing risk while optimizing profitability is a daily balancing act in the banking business.
Tonik’s job cuts and focus on boosting lending revenue align with its goal of reaching sustainable profitability.
However, as a new and highly dynamic digital bank, it faces challenges balancing rapid growth with risk management. Its success in the Philippines could inform expansion plans into other Southeast Asian markets.
To read the original article in its entirety: https://www.techinasia.com/tonik-lays-employees-reaching-unit-profitability
