Many Britons are hooked on costly credit. Here’s what the new minister should do | Rowena Young

What value a life? For Jerome Rogers, a 20 year-old motorcycle courier, it was painfully low. Within 24 hours of a visit from a bailiff, he was found by his brother and a friend to have hanged himself. The sum of his debts? Around £1,000, or a couple of weeks’ income on the average UK wage.

Tragically, he is no longer here to tell it, but stories like Jerome’s are to gain a new level of attention in Theresa May’s government. For this month saw the appointment of the UK’s first minister for financial inclusion.

The news came without fanfare or warning, but was most likely influenced by the Financial Inclusion Commission’s recommendation earlier this year that reform starts with “a senior minister as the government lead on financial inclusion and financial capability”. Guy Opperman MP is the man of the hour and has a longstanding interest in living wages, community businesses and regional banks. He also has responsibility at the DWP for pensions.

Opperman has much to do. In five areas of the UK, including Wales and Northern Ireland, more than half the population has savings of less than £100 and one in three adults has experienced a major financial shock in the last five years.

Today, less than half of UK adults report being able to keep up with bills without difficulty, while just under a quarter manage to get from one month to the next only by rolling over their credit card balances or other form of high-cost credit. One in six can’t afford to make the repayments on money they owe after meeting household expenses and 83% of people in debt simply do not get the advice and support they need. Studies confirm we Brits would rather talk about sex than money.

Advice services also don’t talk to people long before money has become a problem, helping them build a savings buffer, understand the implications of using credit – or borrowing from yourself, as one seasoned banker regularly reminds me – and making sense of the bewildering terms of different loan products.

We need to give communities the tools to make talking about money a norm. Like a handful of similar projects, the Just Finance Foundation, for whom I work, trains people to spot friends and neighbours experiencing financial distress, start a conversation and help them find support. These approaches should become an integral part of an effective advice sector.

But if the new minister is to make a long-term difference, he will need to come up with measures to reduce the reliance on high-cost short-term credit. Although there are credit unions and community finance providers, they are dwarfed by the high-cost lenders such as Wonga and Brighthouse by a factor of 50 to one.

The high-cost sector has been rewarded for getting much right: providing the micro-loans people want, from £50 to a few hundred pounds, coupled with access, speed, flexibility and local agents who take the fear and mystery out of money. But debt too often fuels further indebtedness. Interest rates are so high that poorer customers end up paying for goods many times over, loans are increased or rolled over in perpetuity, and some are extended to customers who are never likely to be able to repay them.

What’s needed are many more providers such as Tandem and Fair for You that both lend responsibly and operate at scale. Until the UK enjoys widespread access to lenders who share these characteristics without the eye-watering APRs and exploitative practice, debt and distress can only grow.