Home > Submit Guest Blog > Contact Us

RBI cautions public against Multi Level Marketing schemes activities for MLM firms or Companies

RBI recently issued a press release cautioning the public against multilevel marketing companies that promise quick profits.
These schemes offered by the MLM agencies focus on the enrollment of new members and the commissions taken from these members.
In these schemes, it is compulsory for members to enroll new members and in response to the new enrollments, members get a portion of the registration fee. Most MLM companies rely on commissions collected in the form of the registration fee, from the enrollment of new members rather than on the sale of products.
The money collected from the enrollment of new members is also distributed in the member's part of the pyramid. When members fail to enroll new members this produces a break in the chain and the pyramid collapses.
Members suffer heavy investment loss when a pyramid collapses. The losses are even more for the members lower on the pyramid.
Reserve bank has advised the public not to get tempted by the MLM entities offering high returns in response to enrolling new members. These temptations result in heavy investment loss and people should act wisely and not accept any tricky schemes offering quick money very easily.
A mention of the Chit fund and Money circulation act of 1978 was also made in the release, which affirms that the acceptance of money under such schemes is illegal and a cognizable offense.
Keywords : RBI cautions Public against Multi Level Marketing Activities

Comments () Average Rating:
Email ID:*

Recent blogs

Planning to invest in network marketi...
Celina disuja 01 Feb 2019
How online marketing can boost mlm bu...
Priyanka 29 Jan 2019
Is mlm business legal or illegal?
James wan 23 Jan 2019
Facts for the growth of network marke...
Priyanka 18 Jan 2019
Scope of network marketing in 2019
Priyanka 15 Jan 2019

Top 5 Most Visited Blog

Rules and guidelines issued by kerala...
Visited By : 18579
Posted By: Sameer
New mlm company registration in india...
Visited By :12977
Posted By: Narendra
6 benefits of institute online examin...
Visited By : 7385
Posted By: Sameer
3 quotes for use of technology in sch...
Visited By :7320
Posted By: Sameer
Multi level marketing mlm legal rules...
Visited By : 6079
Posted By: Sahil bhat

Thank You for subscribing Awapalsolutions Blog

Kindly check your email id and verify it.

Please verify link for confirming your subscription.

Follow us on

You have been already subscribed at Awapal Blog for this email id, Kindly recheck your Inbox and Spam Mail Box and verify it.

If you are unable to receive or verify the email, Kindly mail at support@awapal.com

Follow us on

© 2012-2021 All Rights Reserved | Awapal Solutions Pvt. Ltd.