Learn what a referral programme is, how both the referrer and referee benefit, and the different types of programmes you can join to earn rewards.
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Up to £200 free to spend on whatnot
Referral programmes have become one of the most common ways for companies to attract new customers — and for everyday people to earn rewards simply by sharing products they already use. But what exactly is a referral programme, and how does it all work?
This guide breaks it down from scratch, whether you've never heard the term before or you're looking to understand the mechanics before diving in.
A referral programme is a structured system where a company rewards existing customers for bringing in new ones. Instead of spending money on traditional advertising, the company shares some of that budget directly with you.
Here's the basic idea:
The reward might be cash, account credit, a free month of service, bonus stock, or something else entirely. It depends on the company.
It comes down to cost-effective customer acquisition. Acquiring a new customer through paid ads can cost anywhere from £20 to £200 or more, depending on the industry. A referral programme lets the company pay a fraction of that — and only when a real, verified customer actually signs up.
There are several reasons this works well for businesses:
This is why brands like Monzo, Revolut, and Chase UK invest heavily in their referral schemes — the return on investment is consistently strong.
Let's walk through a real example to make this concrete.
Say you have a Monzo bank account. Monzo gives you a personal referral link inside the app. You send that link to a friend who doesn't have Monzo yet. Your friend clicks the link, downloads the app, opens an account, and makes a qualifying payment. Once those steps are complete, Monzo deposits a cash bonus into both your account and your friend's account.
Up to £200
You earn
Up to £175
You earn
That's it. No complicated forms, no waiting months, no hidden catches (though you should always read the terms).
The typical process looks like this:
If you want a more detailed walkthrough, our how it works page covers the process step by step.
As the person sharing the referral, you earn a reward for each successful sign-up. Depending on the programme, this could be:
Some programmes have no cap on how many people you can refer, meaning the earning potential can be significant if you share actively. Others limit you to a set number per year.
The person signing up through your link almost always gets a bonus too. Companies want to sweeten the deal so your friend actually follows through. Common referee bonuses include:
This two-sided structure is what makes referral programmes feel fair — it's not just the referrer cashing in.
The company gets a new customer at a predictable cost, with a higher likelihood of that customer being engaged and loyal. It's a win across the board.
Not all referral programmes are built the same. Here are the most common types you'll encounter:
The most straightforward type. You refer someone, and you both get real money deposited into your accounts. Banks and fintech apps are the biggest players here — think Chase UK, Monzo, and Revolut.
Instead of cash, you receive credit toward the service. Energy companies, subscription boxes, and SaaS products often use this model. For example, an energy provider might give you £50 off your next bill for each friend who switches.
Some companies increase your rewards the more people you refer. Your first five referrals might earn £10 each, but referrals six through ten might earn £20 each. This encourages ongoing sharing.
Common with airlines, hotels, and credit cards. You earn points per referral that can be redeemed for flights, hotel stays, or other rewards. The value per point varies, so it's worth calculating the actual return.
You get a free product or extended trial instead of money. Cloud storage services, meal kit companies, and fitness apps frequently use this approach.
With thousands of programmes out there, it helps to focus on a few things:
You can browse current referral offers across dozens of categories on our referrals page, or submit your own referral codes if you've got links to share.
It depends on the company. Some programmes let you refer unlimited people, while others cap it at 5, 10, or 20 per year. Always check the specific terms.
In the UK, most small referral bonuses fall below the threshold for casual income and aren't taxed. However, if you're earning significant amounts regularly, it's worth checking with HMRC or an accountant. This is not tax advice.
Many programmes allow it, but some restrict sharing to private channels only. Read the terms carefully — violating them can get your referral privileges revoked.
No reward is paid until the referee meets all the qualifying conditions. If they abandon the process halfway through, neither party receives anything.
If you're new to all of this, the simplest approach is:
For practical tips on turning referrals into real earnings, read our guide on how to earn real money from referral programmes. And if you want to share your codes effectively without annoying people, our piece on referral etiquette is worth a read.
Referral programmes are one of the few genuinely free ways to earn extra money — no investment, no risk, just sharing things you already use. Understanding how they work is the first step to making the most of them.
