How a World War Z-Like Pandemic Would Impact the Banking Industry

The undead who rise again to feed upon the flesh of the living, stoppable only by brain destruction, zombies are fascinating creatures that capture the imagination. Zombies play a central role in the upcoming thriller World War Z, which follows a UN investigator  played by Brad Pitt searching the world for “patient zero,” the first person infected by the zombie plague.

The World War Z movie takes a look at the bigger forces at play — the possible geo-political and even economic impact of a pandemic, in this case, a zombifying infection. We take this a step further and look at the economic impact of a pandemic, to find out how such an event would effect the banking industry and financial situation of their customers like you.

What Is a Pandemic & What Are Its Effects?

What is a pandemic? It’s the same idea as an epidemic, an infectious disease that effects a disproportionate number of the population, though it’s on the next level in terms of how widespread it is, both geographically and in the number if people who fall ill.

What would be a pandemic’s economic impact? One report from Trust for America’s Health found that a pandemic flu has the potential to cause a devastating recession comparable to the recent Great Recession, with a U.S. Gross Domestic Product (GDP) loss of over 5.5 percent ($765 billion, adjusted for inflation). The Center for Disease Control, on the other hand, estimated in 2005 that the loss would be a more modest $186 billion (adjusted for inflation).

The World War Z Pandemic

“If the pandemic is severe, the economic impact is likely to be significant, though predictions are subject to a high degree of uncertainty,” reads a report from the International Money Fund (IMF), pointing out that the impact depends on a host of factors, from the virulency of the infection to how well emergency services are able to respond.

The zombie pandemic depicted in the World War Z movie has, on top of the risk of infection, hordes of zombies to fight off. As the trailer puts it, “Every human being we save is one less to fight.”

Considering both the global scale of the World War Z pandemic and the level sheer terror, widespread panic and destruction it would cause, the resulting economic problems would be much more devastating than with the circumstances used to calculate the numbers above.

A Pandemic Could Bring the Banking Industry to Its Knees

World War ZWith its close ties to the economy, the banking industry would be one of the most heavily affected areas — and also have the potential to cause the most disruption to American’s everyday routines and quality of life. Here are some potential problems that banks and the consumers who use their services should anticipate.

Bank Workers Staying at Home

During a pandemic, many will be in quarantine — whether self-impose or mandated — and unable to go about their daily routines. In addition to quarantine, people may choose to stay home out of fear of infection or to care for a family member.

Having large numbers of workers absent at the same time would leave banks understaffed and lacking the manpower to offer needed services, the IMF explains. “Preparations by large complex financial institutions, key retail banks, and the authorities themselves will need to be robust,” the IMF report warns. “Failure in any of these institutions will have an impact on the global financial system in addition to the direct impact on their own operations.”

Debit & Credit Cards Become Useless

With less workers keeping things running smoothly, IMF predicts that “Operational disruptions could prevent transactions from being completed and obligations from being met.”

That means that payments, specifically those that happen digitally or online such as credit card or debit card charges, may not be able to be processed. Consumers who rely heavily on plastic may find that their cards are no longer accepted as viable payment.

High Demand for Cash

With payment systems offline, cash will once again be king, and likely the only viable option to pay for needed goods or services (unless you can find a merchant willing to accept “IOUs”). Consumers may be found lining up at ATMs trying to get access to their funds.

Spending Limited to Necessities

In an emergency situation like a pandemic, priorities will be limited to the necessities: Health care, food, shelter and water. “Demand could contract sharply, with consumer spending falling and investment being put on hold,” according to the IMF report. Businesses may hurt as consumers put spending on hold to deal with health or family emergencies. Assets like stocks will probably see an abrupt and steep decline in value.

Your Financial Pandemic (or Zombie) Survival Guide

There are no end to zombie survival guides out there, extolling the virtues of one weapon over another for dispatching the hungry dead. But have you considered how a pandemic (zombie or otherwise) would influence your finances? Below are some things to include in your zombie survival guide plan that will help you stay afloat during the emergency and get back on your feet during recovery.

  • World War Z MovieKeep Emergency Cash On-hand: As pointed out above, one of the biggest challenges in a pandemic or any other emergency situation will be paying for necessities like gas, food or other goods. As part of an emergency fund, it’s a smart idea to keep emergency cash on hand. Because merchants may not be able to make change, emergency cash should be a mix of a few big bills with smaller denominations.
  • Store Food & Emergency Supplies: Of course, if you have extra supplies on hand, you won’t need to buy them from others. Emergency supplies should include at least a 72-hour emergency kit for each family member. First aid kits, food storage and clean water are also wise additions for emergency preparedness. Visit to see FEMA’s recommendations for an emergency preparedness kit.
  • Carry Life Insurance: With a pandemic, unfortunately, comes a high number of fatalities. As the pandemic passes and a household starts the road to recovery, the process will be much harder if they’ve lost a family member, making the help received from life insurance coverage all the more important. As the IMF report points out, “A greater percentage of families with life insurance would mitigate the financial effects from the loss of a family’s primary breadwinner.”

About the Author

As a finance journalist and editor with GOBankingRates, Elyssa Kirkham covers finance news, consumer savings and deals, and banking. Kirkham’s work has appeared on major sites like Huffington Post, MSN, Investopedia, CU and CB Insight, The Motley Fool and a range of major local newspapers.