Two typhoons just exposed how brittle our cashless future really is

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Yvonne Su is an associate professor at York University and a visiting scientist at Harvard University.

Many Filipinos abroad trying to send life-saving money home amid two back-to-back typhoons encountered error messages, frozen apps, and agonizing uncertainty about whether their families would receive the funds. Kalmaegi and Fung-wong didn’t just level homes and cut off entire regions last month – they exposed the fragile truth behind the push toward a fully digital financial system: When the power goes out, your money effectively disappears.

In the hardest-hit provinces, millions of people lost electricity, internet access and mobile connectivity. Point-of-sale machines flickered off. ATMs froze. E-wallets, used by the majority of Filipinos, became useless icons on dead phone screens. The timing could not have been worse as roads were flooded, drinking water was scarce, and storms had wiped out most of the food supplies. People had money; some had lots of it. They just had no way to spend it.

This is the unspoken risk of a cashless economy. The more we rely on digital payments, the more a hurricane, heat wave, or grid failure becomes not just an environmental disaster but a financial one. When China’s Hainan province was hit by Typhoon Yagi, the strongest storm in Asia in 2024, videos of disaster survivors desperate to charge their dead cellphones went viral, with the sentiment that without their phones, “You can’t even buy bread.”

For years, tech companies have sold the idea that every social problem has a software solution. This is at the heart of modern tech solutionism – the belief that an app can be a substitute for infrastructure, resilience, and/or state capacity. But a payment system cannot override the laws of physics. It cannot conjure cell towers in a blackout or produce a signal in the eye of a super typhoon. When Silicon Valley insists that digital tools and AI can improve the lives of the poor, it papers over the fact that storms, outages and inequality cannot be coded away.

Super typhoon Fung-wong blows away from the Philippines, leaving 8 dead and 1.4 million displaced

Typhoon Kalmaegi leaves at least 114 dead in Philippines

Around the world, digital payments are being sold as the centrepiece of “financial inclusion.” The pitch is simple: Mobile wallets give low-income households access to banking tools without the need for brick-and-mortar branches. But that promise collapses when the infrastructure that supports those tools, the cell towers, fibre-optic cables, transmission grids, is wiped out by a single storm.

Fragility in digital finance shows up in two ways. The first is obvious: Systems fail when power or connectivity disappears. The second is quieter but just as harmful: Even when everything is technically working, money often cannot move across networks or borders in a timely or predictable way.

Liquidity becomes trapped inside separate wallets or jurisdictions. Transfers are flagged, delayed or rerouted. People must navigate a maze of intermediaries that slows the flow of value at the very moment it is needed most.

And the Philippines will not be the last place to learn this the hard way. Mexico has already had a preview. When nationwide power outages hit earlier this year, millions of families, especially in rural and indigenous communities, were unable to transact for hours. This happened even as Mexico celebrates itself as Latin America’s next fintech hub, with a majority of payment institutions in the country working toward interoperable digital transfers. This shift could save families billions of pesos in remittance fees. But those savings evaporate the moment the network goes dark.

Rural communities across Mexico know this well. AMUCSS, a coalition of community-owned financial institutions, described at the recent Interledger Summit, how routine storms cut off entire towns for days. During these outages, digital payments simply didn’t exist. Local economies stalled. Parents couldn’t buy medicine, and farmers couldn’t buy fuel.

This gap between theory and practice is the central flaw in the global push toward cashless economies. They are designed for stable conditions, even as the world becomes dramatically more volatile.

As we saw at COP30, climate science is blunt about what’s ahead. There will be more overlapping storms, more extended power outages, hotter heat waves, and more frequent infrastructure failures. Yet, digital financial tools still assume perfect weather. They take for granted a constant electrical supply and a reliable cell signal. The world, as they assume, no longer exists. Worst, they argue digitalization makes us more resilient to extreme weather and climate change. More resilient for whom?

Some innovators are finally responding. In Mexico, AMUCSS and the forthcoming People’s Clearinghouse (PCH) project are developing payment tools with offline capabilities, systems that can function during blackouts, after storms, and in regions with fragile connectivity. The goal is simple: to design for the world we actually live in, not the frictionless one we wish we had.

But most digital finance ecosystems remain dangerously optimistic. They rely on private data centres, centralized servers, and complex connectivity layers that fail at the very moments when people need access to money most.

The Philippines’ twin typhoons make this impossible to ignore. A financial system is only inclusive if it works in emergencies, not just in sunny-day scenarios that technology companies prefer to imagine.

If policy makers and fintech developers want a hard lesson in what the next decade will look like, they should study what just happened in the Philippines. In a warming world, the new question is not whether digital payments are convenient. It is whether they can survive the disruptions that are now inevitable. Because when the grid collapses, the internet fails, and the signal drops, “cashless” starts to look a lot like “helpless.”