Basically, a Point-based structure is nothing but the system which is incorporated in a company's earning structure. Also, a currency based on meeting recruiting or sales benchmarks is created by the same point based plan. A point-based system is easier than rewarding all participants with cash.
Many MLM compensation plans have a points-based system. In practice, point systems are used to reward participants because it’s easier than rewarding them with cash, which would have to flow backward through the levels.
It’s also made payouts easier on an international level, since currencies change on a day-to-day basis, setting “levels” based on sales can be difficult if you have to adjust for each country.
Not all points systems are equal, though. Some may be largely a formality and offer nothing of value. Unused points are like leaving money on the table, so make sure you don’t carry any. Some companies may also have policies that cause points to expire after a certain period, so be aware of the terms of their use.