StartupTalky

Tag: payment defaults

  • Good Glamm Group Misses Salaries for 2nd Month in a Row: Trouble Deepens for Beauty Unicorn

    According to reports, Good Glamm Group has postponed staff salaries for the second consecutive month in May.

    April and May’s pay were meant to coincide, according to a news source that quoted an employee, but that doesn’t appear likely to happen anytime soon. It’s clear to everyone now that funding is the reason.

    The financing has been delayed since January, when Good Glamm Group was expecting it to come. Payroll for April has already been postponed by the corporation. According to reports at the time, the business had told its staff that they would get paid in June for both April and May.

    Salary credits have not yet been issued, though, and management has not yet responded to enquiries about the delay.

    Payments of Freelancers and  Former Employees Also Put on Hold

    The Good Glamm Group has not yet paid its former workers’ and freelancers’ debts, according to the report. The unicorn is still owed INR 18,100, according to a LinkedIn post by Babita Bharati, a freelance copywriter for Good Glamm’s portfolio business The Moms Co.

    According to Bharati’s post, working as a freelancer is difficult, and organisations like #GoodGlammGroup make it much more difficult. She also mentioned that in March and April of 2025, she worked as a freelance copywriter for The Moms Co. | Good Glamm Group, but she is currently experiencing problems getting them to pay her for her work.

    Additionally, Bharati stated that she contacted over five different individuals within the company, noting that many members of the startup’s finance team were either already on notice or had departed.

    In order to increase liquidand maity intain business operations, the content-to-commerce startup is apparently thinking about returning its ownership of Organic Harvest to the company’s founders, according to a media report. In 2022, the Good Glamm Group bought the bulk of Organic Harvest.

    Despite this, there have been numerous resignations due to the firm’s instability. Kartik Rao, the startup’s chief people officer and a board member of WYN Beauty, a joint venture with Serena Williams, recently left the company to join the AI-driven recruitment platform Vahan.ai.

    Delaying Salaries has Become Common Practice of Good Glamm in 2025

    This year alone, the corporation has postponed salaries three times. Payouts for a portion of the company’s workforce were already postponed in January after a possible funding round fell through.

    However, it eventually paid down the outstanding balances in instalments. The founders of acquired businesses like Sirona and The Moms Co., as well as investor IAN, have sent the company default notifications for nonpayment over the past year.

    The unicorn has also conducted huge layoffs and offered several of its brands for sale in an effort to lengthen its runway. Recent rumours that supporters Accel, Prosus, and Bessemer have resigned from the company’s board have made the situation worse.

    Its growing losses, shortcomings in product development, excessive marketing expenditures, low sales, and a decline in skincare product quality are all major contributors to this.

    Important members of the product and marketing teams of numerous brands that the unicorn purchased are said to have been sidelined by the beauty-focused D2C platform, which has caused brand dilution and driven many of these brands further away from profitability.

  • State-Owned MTNL Defaults on 7 PSU Banks’ INR 8,346 Crore in Bank Debts

    Mahanagar Telephone Nigam Ltd (MTNL), a state-owned telecom service provider, announced on April 19 that it had fallen behind on bank loans from public sector lenders of INR 8,346.24 crore, as per the exchange filing. Seven public sector banks provided loans to the company, including the Union Bank of India, Bank of India, Punjab National Bank, State Bank of India, UCO Bank, Punjab and Sind Bank, and Indian Overseas Bank, according to BSE data. According to the declaration, the total amount of outstanding debt, including both short-term and long-term borrowings, was INR 33,568 crore following the most recent default of INR 8,346.24 crore. To pay the interest on the SG Bond, this is further separated into a bank loan, an SG Bond, and a loan from the Department of Telecom.

    How Much MTNL Owes to Each Bank?

    MTNL has defaulted on INR 3,633.42 crore to the Union Bank of India, INR 1,077.34 crore to the Bank of India, INR 464.26 crore to the Punjab National Bank, INR 350.05 crore to the State Bank of India, INR 266.39 crore to the UCO Bank, INR 180.30 crore to the Punjab and Sind Bank, and INR 2,374.49 crore to the Indian Overseas Bank, according to the filing data. The loan principal and past-due interest amount are included in the default payment figures, which cover the period from August 2024 to February 2025. In addition, the corporation owes INR 8,346 crore in bank loan defaults, INR 1,151 crore in Department of Telecom debt, and INR 24,071 crore in SG Bond debt.

    MTNL a Sinking Ship

    The telecom operator is experiencing a serious liquidity shortage as a result of the frequent defaults. In the previous months, the company had sent a series of letters informing the stock exchanges of similar defaults. According to TRAI data, at the end of March 2023, MTNL held a 0.21% market share in the cellular segment and an 8.14% market share in the wireline segment. The business has recently accrued a significant amount of debt and has been reporting losses for a number of years. With the exception of the 2013–14 fiscal year, MTNL has been reporting losses annually since it first disclosed one in the 2008–09 fiscal year. The hefty labour costs borne by both MTNL and BSNL, two public sector undertakings (PSUs), are a major contributing factor to the debt.

    MTNL currently employs 3,547 people, while it once employed over 20,000 people in only two service areas. In 2019, around 15,000 workers at MTNL chose to participate in the voluntary retirement plan (VRS). Another major factor contributing to MTNL’s collapse was its limited reach. In the National Capital Region (which includes Delhi and the nearby cities of Faridabad, Gurgaon, Noida, and Ghaziabad), Mumbai, Thane, and New Mumbai, it provides both fixed-line and wireless services. In terms of customer experience, MTNL has also failed to match commercial players. Due to years of being the sole service provider, the company was ill-equipped to handle subscribers’ issues in a satisfactory manner.

  • Under the IBC, the RBI will Start the Resolution Process Against AVIOM India

    Citing governance issues and payment defaults, the Reserve Bank of India (RBI) replaced the board of Aviom India Housing Finance on 27th January. Ram Kumar, a former Chief General Manager (CGM) of Punjab National Bank, was named administrator. In addition to applying to the National Company Law Tribunal (NCLT), New Delhi, to designate the administrator as the Insolvency Resolution Professional, the regulator stated that it “intends to shortly” begin the company’s resolution procedure under the Insolvency and Bankruptcy Code (IBC).

    The main business of Aviom is lending money for affordable housing. According to India Ratings, as of March 31, 2024, the promoter Kajal Ilmi and her family owned 31.4% of the company on a fully diluted basis. Other significant stakeholders included Nuveen (35.06%), Gojo and Company Inc. (19.84%), SABRE Partners AIF Trust (9.88%), and Capital 4Development Asia Fund Cooperative UA (3.78%).

    What is the Insolvency and Bankruptcy Code?                                                           

    A healthy credit flow and the creation of fresh capital are crucial in an expanding economy like India, and when a business becomes insolvent or “sick,” it starts to fall behind on its loan payments. Banks or creditors must be able to collect as much as they can from the defaulter as soon as possible in order for credit to avoid becoming stuck in the system or becoming bad loans.

    The company may be given the opportunity to start over with new owners if it is still viable, or its assets may be promptly liquidated or sold. In this manner, new credit may be added to the system, and asset value degradation can be reduced. The Insolvency and Bankruptcy Code (IBC) was introduced in 2016 to revamp India’s corporate distress resolution regime and consolidate existing laws to create a time-bound mechanism with a creditor-in-control model instead of the debtor-in-possession system.

    This was done at a time when India’s non-performing assets and debt defaults were mounting and older loan recovery mechanisms like the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act (SARFAESI), Lok Adalats, and Debt Recovery Tribunals were perceived to be underperforming.

    How Discrepancies Began in Aviom?

    In the midst of allegations regarding irregularities that are being looked into, the company’s statutory auditors discovered errors in its books of accounts. The National Housing Bank (NHB) has also been notified of a scam within the organisation. The business had also complained to the Economic Offences Wing (EOW). The business has been dealing with delayed interest payments and liquidity problems. It is being audited by a third-party forensic auditor that NHB has hired.

    In the quarter that ended in March 2024, Aviom India Housing Finance’s net profit decreased 14.09% to INR 6.34 crore from INR 7.38 crore in the quarter that ended in March 2023. In the quarter that ended in March 2024, sales increased by 58.94% year-over-year (Y-o-Y) to INR 117.38 crore, up from INR 73.85 crore in the quarter that ended in March 2023.

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    StartupTalkyNitin Konde