Improving access to cash in a natural disaster

Some consumers like to have a few bucks in their pockets, others prefer to go all digital. But a natural disaster is the great equalizer. When a hurricane, flood, forest fire or other weather-related catastrophe strikes, digital payment tools that depend on electricity and connectivity might not be available. Cash may be the only working form of currency for the survivors of a disaster—people who may have just lost a loved one or their home—to buy clean water, food, medicine, fuel and other essentials.

When a weather-related catastrophe strikes, cash may be the only working form of currency.

This is especially concerning as the frequency and intensity of extreme weather events increases. In 2024 alone, widespread destruction and fatalities were caused by hurricanes Helene and Milton in the US, typhoon Yagi in Myanmar, China, the Philippines, and Vietnam, tropical storm Helene in the Cayman Islands, Wayanad landslides in India, major wildfires in Argentina and Peru, and severe flooding in France, Spain, Afghanistan and Pakistan.

And while extreme weather threats are increasing, the average person just isn’t well prepared for the eventuality of a disaster happening where they live. In the US—a relatively well-to-do country by global standards—only 18.3% of people have set aside emergency funds to cover damages caused by natural disasters, though 61.6% of respondents report that widespread climate change is increasing the danger they pose.

How many people are without access to cash in a natural disaster? Unfortunately, there isn't a specific, globally applicable percentage for access to cash during natural disasters. The availability of cash can vary significantly depending on the severity of the disaster, the location, the level of infrastructure damage, availability of ATMs and level of reliance on digital banking. But swift and effective responses from governments and financial institutions can help mitigate the impact of disasters on cash access.

Challenges facing financial institutions from natural disasters

As a recent article in The Financial Brand asserts, as the prevalence of natural disasters increases, financial institutions (FIs) are facing new challenges in maintaining cash availability and operational continuity in the aftermath of weather-related events.

FIs are rethinking disaster preparedness plans to serve local communities better during crises—with a focus on maximizing availability of cash and operational continuity. For many, this means ensuring that their ATM fleets and third-party ATM utility networks are strategically managed at surge capacity to accommodate customers seeking to prepare themselves ahead of time by withdrawing extra cash when a disaster is predicted. It also means thinking through how people can use mobile banking, online banking, branches and ATMs (as they can be available under the circumstances) to check balances, move money and make payments in the aftermath of a disaster.

In the midst of these concerns, FIs may face challenges of their own when a disaster happens, including physical destruction and communication breakdowns. When this happens, governments and other FIs often step in to help FIs in hard-hit areas maintain their operational continuity.

Strategies for preserving cash availability in disasters

Diversifying cash reserves: Storing cash in multiple locations across different regions for rapid deployment to disaster zones can help mitigate the impact of localized disasters. (The old adage, “don’t put all your eggs in one basket”, is definitely true when it comes to managing cash immediately after a disaster, when the power may be out and transportation options may be limited.)

Outsourcing to ATM networks before a disaster occurs: Setting up ATM network solutions and servicing before disaster strikes can maximize availability of ATMs and ITMs (for help from a banker over video)when critically needed, expanding financial access as much as possible in, around and adjacent to a FI’s footprint in collaboration with a FI’s branches. As part of a large ATM network, FIs can offer their customers access to safe and secure transactions, including surcharge-free withdrawals, deposits and payments, where power is available along evacuation routes in the wake of a disaster. For many, such access is a lifeline for securing meals, hotel rooms, fuel and more.

Collaboration for maximizing availability and liquidity: Using flexible tools like mobile ATMs and armored off-road vehicles to quickly move cash to affected areas. It’s important to remember that, in the wake of events, FIs on the ground in a disaster area are not alone. Other FIs outside a disaster area are often more than willing to collaborate on recovery efforts and share resources and liquidity across connected regions. This can make a tremendous difference for both the well-being of customers and the recovery effort in general.

It’s important to remember that, in the wake of events, FIs on the ground in a disaster area are not alone.

Leveraging government assistance: Taking advantage of resources provided by regulatory bodies, such as the Federal Reserve and the Federal Deposit Insurance Corporation (FDIC) in the US, to support liquidity and recovery efforts. For example, after Hurricane Katrina, FEMA issued Mastercard-branded debit cards to evacuees for access to FEMA benefits (though it did not do so after Hurricanes Helene and Milton), and The U.S. Department of the Treasury asked depository institutions not to impose ATM surcharges on evacuees who used the cards to obtain cash from ATMs.

In Europe, the European Union Solidarity Fund (EUSF provides financial assistance to member states affected by major natural disasters. For example, in 2022, the EU allocated €668 million to Germany, Belgium, Spain, the Netherlands, Luxembourg, Greece and Austria to help repair damage from floods, a volcano eruption, and an earthquake. The Union Civil Protection Mechanism (UCPM) coordinates disaster response across Europe, including forest and urban firefighting, search and rescue operations and the deployment of medical personnel.

In Africa, the governments of Mozambique, Malawi, and Zimbabwe mobilized their resources for early response to Cyclone Idai in 2019 with significant assistance from international organizations, including the United Nations (UN). Africa's Emergency Response sets up temporary water supply stations, distributes food and emergency kits and provides medical supplies during disasters. For example, they responded to the Western Cape floods in South Africa in 2024.

India has a history of providing aid to its neighbors during natural disasters. Notable efforts include relief operations after the 2004 tsunami, the 2005 India-Pakistan earthquake, and cyclones Nargis and Mora in 2008 and 2017, respectively. The UN, through agencies like UNICEF and UNDP, coordinates humanitarian relief in the subcontinent. Providing immediate funding for lifesaving actions, supporting children and helping to rebuild communities after disasters.

Proactively preparing customers: Providing information and guidance to customers on how to access their funds and manage their finances ahead of, during and after a disaster. (Think social media posts, in-branch POS messaging and website promos, to name a few.)

Building robust contingency plans: Creating detailed plans for disaster response, including procedures for securing cash reserves, restoring operations and communicating with customers as quickly as possible.

With such emergency protocols in place, including disaster contingency plans (DCPs) and business continuity plans (BCPs), a FI can get out in front of the problems we know happen in a disaster—including shortages of physical cash and the need for interim loans for customers and non-customers, the banked and the unbanked—and go a long way toward supporting both immediate and long-term recovery efforts.