In Simple Words
Imagine a game of telephone where an insurance company explains a complex policy to a regional official, who explains it to a village extension worker, who explains it to a lead farmer, who finally tells local neighbors. By the time the message reaches the end user, key rules about payouts and credit guarantees have been misunderstood or omitted.
Cooperatives offered insurance
- Sales occurred
- 23 cooperatives
- No sales occurred
- 11 cooperatives
2012 implementation records. Indirect communication was a possible issue; its causal contribution was not measured.
See source →Research question
Introducing complex financial innovations through local government extension workers and lead farmers distorts product details, preventing smallholders from understanding contract terms and depressing uptake.
Participants
N = 34 treatment primary cooperative villages across 4 zones in Amhara, Ethiopia.
Study Design
Field supply-chain implementation analysis tracking communication channels and sales outcomes across 34 treatment primary cooperatives.
Results
Sales failed entirely in 11 out of 34 treatment cooperatives (32.4%) due in part to indirect, distorted communication passed through extension agents and model farmers, leaving farmers confused about policy terms.
Takeaway
Deploy direct-to-farmer visual marketing campaigns delivered by trained insurance representatives rather than relying on multi-tiered extension networks for novel financial products.