We use "points" to allow our members to see who is the most active in the community. Our leaderboards uses this to show the "top most active" members in each group.
So its a lot like getting "airline miles" whenever you fly or uses your credit card. And except that we don't charge your credit card (or take any other payments), then its very much the same. When you participate in some activity like posting or replying in the forums, then you accumulate points. And whenever someone replies to one of your posts, then you also get points. If you like some of the content (ex. a post or reply), then that will also give the author of the content points.
Our "Membership Ranks" are also based upon the points. Our member profile biography (that may contain external URL links), is only visible for members with a minimum of 100 points to prevent "spam-members".
The points are also used by the website to calculate an internal "quality factor", based on how many points an author and the associated content have.
As a member you can see your own points, and a specification for what activities gave you these points, if you click on the points link in your membership profile.