How Financial Providers Can Support Consumers through a Government Shutdown

Yesterday, the U.S. federal government suspended all operations except those deemed essential. Why? Every year, Congress passes legislation to fund the federal government for the coming fiscal year — which began on October 1, 2025. However, if the appropriations process is not completed in time, the government halts all unfunded “non-essential” functions until a new appropriations bill can be enacted. 

While most shutdowns are resolved within less than two weeks, a longer-lasting shutdown could have a serious impact for our nation’s consumers and small businesses. And, if history repeats itself, this could be a longer process. In fact, according to CNBC, the last shutdown happened in late December 2018 and was the nation’s longest on record, running 35 days. 

Work Without Pay, or No Work at All

Government shutdowns can have far-reaching economic consequences and devastating implications on people’s livelihoods. 

Forty-percent of the federal workforce – approximately 750,000 people – could be furloughed and put on unpaid leave. At the same time, essential federal workers, like law enforcement, military, and Transportation Safety Administration (TSA) workers, will continue to work but won’t receive paychecks until operations resume. While most workers will receive back pay, many federal contractors won’t have that assurance. 

Without a steady paycheck, the implications could be massive: 

• No incoming funds for everyday costs like groceries, gas, and utilities. 
• Missed mortgage and rent payments, putting housing at risk.
• Rise in overdue bills or overdraft fees as bills that are on autopay become delinquent — incurring additional fees and putting services at risk.
• Increase in the cost of borrowing as credit scores take a hit.
• The need to tap into savings or retirement funds to cover any shortfalls.

Many financial providers who serve the military community, such as USAA, Navy Federal Credit Union, and PenFed, offer programs to provide zero-interest loans or paycheck protection. But what about those outside of the military or who have accounts with other providers? As financial providers, this is our time to help consumers in this situation weather the storm. 

There are many ways the financial services industry can help in the short-term, including:

• Determine those customers or members that are impacted and reach out to them to provide support. 
• Offer pauses or extensions for recurring debt repayments — mortgages, credit cards, Buy Now, Pay Later, loans, etc. — without penalties.
• Offer no- or low-interest loans to cover living expenses, and make the payback easy when paychecks resume. 
• Increase visibility into account balances to help consumers spot if recurring payments will put their account into overdraft.
• Pause overdraft fees if they are still in place.
• Stop outbound marketing for products that may be insensitive to the reality of people who are worried about making rent and putting food on the table.