The following is the first in a series of guest blogs fromConsultative Group to Assist the Poor (CGAP).
Digital Finance Plusis the use of mobile money and branchless banking to make basic, essential services and utilities - in energy, health, education, and water, for example - more accessible to people at the base of the economic pyramid. Here finance is not an end itself but a means to help solve significant development challenges in order to improve the lives of the poor. Through a series of video interviews and an animation, this blog series introduces the concept of Digital Finance Plus and highlights some of the innovative companies and individuals working in this space.
In today’s Hangout, we chat with Rasoul Mikkelsen, Global Manager for Grundfos Lifelink.He discusses how Grundfos leverages a digital payments platform to provide water to under served communities.
Grundfos is a global market leader in designing and selling water systems and is one of the world’s leading pump manufacturers. Grundfos foresaw the opportunity to use digital finance to make clean water more accessible, and in 2010 launched “Lifelink”, an innovative water distribution system for rural communities that leverages M-PESA. Upon realizing that rural community water projects were often unsustainable due to poor accounting systems, Grundfos conceptualized a pay-as-you-go (PAYGO) model that improves community water management by increasing transparency and reducing the reliance on cash.
"At Grundfos, we are trying to address economic, social and environmental sustainability through Lifelink," Rasoul explained. “The system provides a holistic solution…through a closed payments system where people can use their mobiles to transfer credit to smart cards and then they can use these smart cards to pay for water.”
Camilo Tellez-Merchan and Kabir Kumar are both with CGAP's Technology and Business Model Innovation Team. They are leading the work onDigital Finance Plus.