Hurricane Sandy Has Major Impact On Banking, eCommerce Industries
We’re still coming to realize the full extent of the damage Hurricane Sandy has caused to people, land and businesses along the east coast. With around 50 people dead, millions without power and major metropolitan areas badly damaged, many of our worst pre-storm fears have come to fruition.
While there are larger forces at play, it’s important to remember that the payments industry has been affected by the storm as well. With the stock market closing Monday and Tuesday, hundreds of banks and businesses forced to temporarily cease operations and consumers facing tough financial realities, Sandy’s impact on payments will be felt for some time to come.
We summarize some of the biggest stories and trends surrounding the storm below.
Storm Spells Trouble For eRetailers
There are a huge number of eRetail sites based on the East Coast, and especially in New York and New Jersey: two areas hit hardest by the storm. Take Fab.com, a New York-based company with a warehouse in New Jersey, giving it twice the potential to be impacted by Sandy. Fab.com had to temporarily halt all shipments of packages thanks to a power outage at its warehouse, and noted that about one-third of its employees were powerless as well.
Fab.com was hardly alone in its predicament: this piece by Internet Retailer details major companies, such as 1-800-Flowers.com, Victoria’s Secret and Target all experienced downtime for their websites on Monday. In a related piece, The eTail Blog published this article in which two experts detail how retailers can prepare for and remain running during natural disasters.
Banks To The Rescue?
Many major banks are chipping in, making large donations to relief efforts and offering fee waivers for those affected by the storm. Bank of America will donate $500,000 to the American Red Cross Hurricanes 2012 Fund, and an additional $500,000 to Sandy-related nonprofits. In a similar vein, Wells Fargo is donating $250,000 to the Red Cross and $750,000 to nonprofits. Citi is also donating $1 million to the Red Cross, while HSBC is making a major donation as well.
In addition to donations, Banks are also working to reduce the financial burden on those most affected by the storm. Wells Fargo announced it will waive certain fees for customers along the east coast, including late fees for credit cards and home-equity, auto, student and small-business loans. Citizens Bank has taken a similar stance, and, like Wells Fargo, will forgive foreign ATM fees in affected regions as well.
Even In Hurricanes, There’s An App For That
In a sign of just how ubiquitous Apple apps have become, Tech Crunch tells us that during the storm, the three most popular apps were YouTube, Hurricane by American Red Cross, and Flashlight by iHandy, Inc. It’s fascinating to see how quickly the app market changes in response to current events, and given the utility of the Hurricane and Flashlight apps in a storm, there’s a good chance that iOS devices could have truly helped some people during Sandy’s harshest hours.
Uber Tries To Surge With Storm, Gets Swept Away
With Uber’s New York City fate still hanging in the balance, odds are they didn’t make any friends with their decision to use “surge pricing” in the aftermath of the storm. Uber uses surge pricing to raise its fees during times of particularly high demand: something consumers will likely put up with at rush hour or on weekend nights, but which they did not tolerate after a major natural disaster. Uber at first claimed that’s its surge pricing was meant to entice more drivers to hit the road, but the e-hailing company eventually caved to public pressure, reverting to its standard pricing.
Can you think of other examples of short or long-term effects Hurricane Sandy will have on the payments industry? Let us know in the comments below.
Please send all press releases and story ideas to Ben Carsley at firstname.lastname@example.org.