Ofo Denies Reports It Can’t Keep Up With Salary Payments – Yicai Global
What happened: Bike rental firm ofo has denied claims that it was not able to pay all of its staff salaries last month. The company rebutted rumors by saying that it had paid all employees as required and that it holds the right to counter libelous claims. Reports circulated yesterday (September 11) that the company is battling a mountain of debt, and, as a result, had not made payments to employees.
Why it’s important: The latest rumor comes after claims that the company has taken out a loan from Alibaba to the tune of RMB 60 million. Whether this is true or not is not known, as conflicting reports proliferate. However, ofo has been facing financial difficulties for most of the year. The company has retreated from international markets, saying that it is focussing on areas that are of a high priority. In order to increase its revenue ofo began selling advertising on its bikes. However, this effort was thwarted by local governments in some areas. Most recently, it began selling advertising in the form of five-second videos in its app.