youtag fake or real? Reviews and complaints

Introduction

Youtag has gained a lot of popularity in India as a multi-level marketing (MLM) company that offers various services to its members. However, there are also several allegations floating around regarding the legitimacy of Youtag and whether it is actually a scam or not. In this detailed article, we will thoroughly analyze Youtag by looking at different aspects of the company like its business model, income plan, management team, legal documents and more to determine if Youtag is a fake MLM scheme or a real business opportunity.

Youtag Business Model

Let’s first understand the business model that Youtag follows. As per the information provided on their website, Youtag offers two types of membership plans – Free and Prime.

In the free plan, members can sign up for free and avail some basic services like mobile/electricity/gas bill payments, movies/travel bookings etc. However, to actually earn an income through Youtag, one needs to enroll in the prime membership by paying an initial fee of Rs. 590.

The prime members then get access to all the basic services along with the opportunity to earn commissions by referring other prime members. Youtag works on a multi-level marketing structure where members can earn through different income streams like team referrals, service commissions, direct selling etc. based on their position in the referral network.

On the surface, this type of membership-based MLM model is not entirely uncommon. However, some key questions arise regarding Youtag’s ability to sustain such commissions in the long run without a significant product line of its own. But more on that later. For now, let’s examine their income plan in detail.

Youtag Income Plan

As mentioned earlier, the core way through which Youtag members can earn is by referring others to become prime members. Here are the different income streams as per Youtag’s documentation:

Team Referral Income

Members earn 50% of the joining amount (Rs. 250) for every direct referral who signs up as a prime member by paying Rs. 590. This referral network extends up to 20 levels deep.

Service Commission Income

Every time a member or their referral utilizes any service on the Youtag app, the referrer earns a commission ranging from 1-10% depending on their level in the matrix. This passive income stream is their unique selling point.

Direct Seller Referrals Income

Members can become direct sellers and earn Rs. 500 for every direct referral who does Rs. 1 lakh business. This scales up to Rs. 5,000 for 10 referrals doing Rs. 10 lakh business each.

Royalty Income

Higher earning members can qualify for monthly royalty payments based on their rank and monthly team performance. Ranks include Diamond, Platinum etc.

Incentives and rewards

Travel packages, electronics, cars etc. are given to top performers on achieving certain ranks and volumes.

On paper, this income plan looks quite lucrative. However, some aspects need further scrutiny to understand Youtag’s real potential and sustainability.

Understanding Youtag’s Management

No multi-level marketing company can sustain itself without strong and ethical leadership. So who are the people behind Youtag? As per their documentation:

• Chandrabhan Singh Rajawat – CMD (Also claimed to be a lawyer)

• Kumar Hem Chandra – Director

• Rohit Sharma – Director

• Vinod Kumar Prajapat – Director

• Sarita Singh – Director (Name not mentioned in PDF)

Some key issues arise here:

• A practicing lawyer cannot hold a full-time position like CMD as per Bar Council rules.

• Most directors do not have relevant experience related to technology/finance required to scale such a business model.

• One director’s name was omitted from their own documentation raising transparency concerns.

• Background checks could not verify credentials of all individuals listed.

Unless the management improves corporate governance and brings in leaders with requisite skills and compliance-related expertise, it remains questionable if Youtag can achieve long term success and sustainability.

Checking Youtag’s Legal Compliance

As with any direct selling/MLM company, having proper legal registration and statutory compliances is imperative. Youtag claims to have the following documents:

• PAN Card

• GST Registration

• MCA Certificate with TAN number

However, there have been complains that some of these documents like GST registration number are not properly verifiable or have discrepancies.

Moreover, multi-level marketing is a regulated business in India that needs to adhere to guidelines by the Department of Consumer Affairs. It is unclear if Youtag has obtained necessary direct selling license to legally run their referral-based model.

Without proper verification of all legal documents from authorized government sources and compliance with direct selling laws, a doubt remains over the legality of Youtag’s operations.

Issues With Youtag Services

A major part of Youtag’s commissions to members is based on the services availed through their app. However, several reported that many touted services like movie/travel bookings or bus ticket reservation simply do not work as advertised.

Some services displayed different pricing than platforms like MakeMyTrip while others showed errors. This raises doubt about the actual commission payouts to members if bulk of services are non-functional.

Moreover, Youtag requires members to top-up a wallet in their app to pay for services. There is no clarity if they are licensed as a payment system/wallet provider by RBI, making such funds potentially at risk.

With no real utility of flagship services that their business model relies upon, it brings the viability of their entire income plan and product portfolio into question.

Red Flags and Unanswered Questions

While hype and promises can attract many in the initial stages, some glaring red flags remain unaddressed by Youtag:

• Presentation emphasizes on dream lifestyle over legitimate business opportunity.

• Inability to have even basic services functioning properly after years of operation.

• Vague responses to queries regarding government permissions, inflow/outflow of funds etc.

• Top distributors pushing aggressive recruitment over quality of services or products.

• No information available on financials, source of funds to sustain rewards/payouts.

• reluctance to disclose proper background of all individuals running the company.

• Unverifiable claims about being associated with global organizations.

Unless Youtag comes clean on these issues in a transparent manner, it will continue to raise suspicions of being a pyramid scheme dressed as an MLM.

Final Verdict – Youtag Fake or Real?

After evaluating various aspects of Youtag and comparing it against norms of legitimate direct selling business, here is our considered view:

• The compensation plan and business model relies heavily on constant enrollment of new members and their usage of non-functional services in a recruitment-driven manner – classic hallmarks of a pyramid scheme.

• Absence of credible management with relevant experience and proper legal documentation brings the intention and operations of the company under question.

• Failure to address major concerns around legal compliances, source of funds and information transparency suggests lack of commitment to ethical and compliant business practices.

• Unfulfilled promises and non-delivery of even basic services after years of presence indicates this is more about promoting recruitment over product delivery.

Unless Youtag makes some drastic and verifiable changes to address all issues comprehensively in a transparent manner, it can be said that the likelihood of Youtag being an illegitimate MLM scam far outweighs it being a genuine and sustainable direct selling opportunity.

Members would be well advised to exercise extreme caution before investing their hard-earned money in such schemes making unbelievable income promises. Let the buyer beware!