Is an airtime referral programme a pyramid scheme? How to tell

South Africans have every reason to be careful. Too many people have lost money to schemes that looked like opportunities. So when anyone says "earn from referrals", including us, you should ask hard questions. Here are four that separate a real business from a scheme. Ask them of every programme.

1. Where does the money come from? In a pyramid scheme, the money paid to earlier members comes from the joining fees of later ones. In a real programme, it comes from customers buying a product they actually use. *Ukutel: earnings are a share of airtime that members use to make phone calls. If nobody makes calls, nobody earns.*

2. Do you have to pay to join the earning side? A scheme sells you a position, a starter pack or a rank. *Ukutel: there is no joining fee and nothing to buy for resale. You are a customer with a phone line. The link comes with it.*

3. Would the product make sense with no earning at all? If nobody would buy the product for its own sake, the product is a cover. *Ukutel: a cloud phone number with calls charged per second. Many members never refer anyone and simply use it.*

4. What are you told about income? A scheme promises quick, easy, large returns. A real programme tells you the amounts and the conditions. *Ukutel: R2.50 to R7.50 (about $0.15 to $0.46) a month per team member, 2.5% on top-ups. Alone, about 31 people in two years of steady effort. It becomes real money only with a team that also refers, and most people do not.*

A real programme can still be a poor fit for you. If you do not enjoy introducing people to things, this will not earn you much, and that is fine: use the calls and ignore the rest.

We would rather you ask all four questions out loud. A programme that cannot answer them plainly has already answered.