expense volatility are undermining households, ” https : / / ssir. org / articles / entry / mismatch _ how _ income _ and _ expense _ volatility _ are _ undermining _ households the pew charitable trusts, the role of emergency savings, http : / / www. pewtrusts. org / / media / assets / 2015 / 10 / emergency - savings - report - 1 _ artfinal. pdf. federal reserve board, report on the economic well - being of u. s. households, 21, https : / / www. federalreserve. gov / publications / files / 2017 - report - economic - well - being - us - households201805. pdf ( “ over the past five years, as the economy has recovered, the fraction of families able to easily cover this emergency expense has increased by about 9 percentage points. ” ). see marra, “ the financial diaries authors discuss income volatility, ” https : / / www. stlouisfed. org / publications / bridges / fall - 2017 / financial - diaries - authors - income - volatility. federal reserve board, report on the economic well - being of u. s. households, https : / / www. federalreserve. gov / publications / files / 2017 - report - economic - well - being - us - households201805. pdf. for example, one - fourth of adults who are not confident in their ability to be approved for a credit card self - reported that they had experienced hardship from income volatility over the past year, as compared to only 6 percent of those who were confident in their credit availability. - 11 perceived chance of being approved for funding rather than on the cost or their ability to repay the debt. the federal reserve system ’ s 2017 small business credit survey finds that this is one of the most appealing features of online lenders for small business borrowers. 32 with regard to consumers, a 2014 report by the bureau of consumer financial protection found that 80 percent of payday loans are rolled over or followed by another loan within 14 days. 33 the bureau found that many loan sequences end quickly, but 15 percent of new loans are followed by others - - and half of all loans were part of a sequence of at least 10 loans. full stack financial inclusion for financial health a sustainable solution is likely to require a comprehensive understanding of the needs of financially underserved families and

to address the challenges underlying financial inclusion. moreover, these tools can be built upon a new generation “ measuring financial well - being : a guide to using the cfpb financial well - being scale, ” bureau of consumer financial protection, https : / / www. consumerfinance. gov / data - research / research - reports / financialwell - being - scale /. center for financial services innovation, “ center for financial services innovation launches ‘ u. s. financial health pulse, ’ ” press release, april 3, 2018, https : / / s3. amazonaws. com / cfsi - innovation - files2018 / wp - content / uploads / 2018 / 04 / 27001554 / u. s. - financial - health - pulse - 2018 - press - release - finalfor - web. pdf. - 13 of platforms and other basic building blocks, which can be used in combination to develop more effective full - stack solutions. within the federal reserve system, we recognize that we have a role and, potentially, a responsibility to help create an infrastructure that facilitates safe, innovative, and ubiquitous faster payment services. earlier this month, we announced that we are seeking public comment on whether the reserve banks should take a more active role in modernizing our infrastructure to support interbank settlement of faster payments in real time. 36 for households living paycheck to paycheck, the difference between waiting for a payment to clear and receiving a payment in real time is not merely an inconvenience ; it could tip the balance toward overdraft fees, bounced checks, or collection fees. of course, faster payments would not address the root causes of financial fragility, but they could help reduce the strain on some. 37 in addition, many small businesses cite immediate access to working capital to finance inventories or pay employees as their number one constraint on growth. if a small business could count on its customers ’ payments being immediately accessible in its bank account, it could reduce the need for short - term financing to cover the costs of ordering materials and goods well in advance. this could also make a difference for the many hourly wage employees that receive their pay in the form of paper checks. electronic payments currently can take lael brainard, “ supporting fast payments for all, ” ( speech at the fed payments improvement community forum, chicago, il, october 3, 2018 ), https : / / www. federalreserve. gov / newseve