March 20, 2009
Grundfos Lifelink is the most recent addition to the Grundfos New Business companies
The purpose of the company is to develop, sell and offer services for automatic water systems, primarily aimed at rural areas in third-world countries.
LIFELINK is intended to become a sustainable business in every sense: Environmentally, socially and financially. Money must be made – and this is not simply a case of offering development aid. On the contrary, LIFELINK is Grundfos’ first step into the BOP (Bottom Of Pyramid) market. The group constitutes a large part of the four billion people in the world who live on less than 2 US dollars a day, and they therefore constitute the bottom of the social pyramid.
Technically speaking, the LIFELINK solution is a combination of the well-known and thoroughly tested SQFlex system with an advanced SQFlex submersible pump, driven by solar panels and combined with a storage tank for the water – all combined with an automatic payment system operated via mobile telephones and data transfer.
LIFELINK is also an innovative business model in which the users – typically small villages in Africa, Asia or Latin America – purchase the system and finance it through a local micro-financing partner, with whom LIFELINK cooperates. Repayment of the loan is made by the users paying for their water via their mobile telephones.
In addition to the repayment, the account which receives the money for the water will allocate a certain amount towards ongoing service and repair work.
Calculations show that – using this method – a system will typically be repaid within a 5-year period. After that, the village owns the system and may, for example, continue to pay a reduced price for the water in order to cover ongoing service work. The system may be surveyed via the Internet and will automatically send error messages in the form of text messages to LIFELINK’s local service department.
The concept is undergoing practical tests in 2009 in Kenya, after which it will be rolled out to other East African countries – and later on to other parts of the world.