Consumer affairs minister Melanie Johnson has set out a new drive to tackle loan sharks. A fast track tribunal system allowing people to challenge unfair credit or loan agreements was announced today.

Forum Response: National Consumer Council

A spokesperson from the National Consumer Council (NCC) said: "At last the government is taking a serious look at the current, outdated system. Consumers have been waiting for changes for far too long.

"We need to make sure that people, especially those who are vulnerable, are protected by the law and treated fairly. A simple, user-friendly, fast track complaints system for extortionate loans needs to be put in place, so disreputable money lenders can be identified quickly and challenged by the thousands of consumers that are currently being ripped-off".

Forum Response: Consumers Association

Delroy Corinaldi, Public Affairs Officer, Consumers' Association, said: "We welcome the government's proposals to make it easier for people to challenge unfair credit agreements without the expense of going to court, and the moves to make loan agreements more transparent by giving full and clear information to consumers."A recent Which? report exposed the number of debt management companies who are taking advantage of desperate and vulnerable consumers. Today's proposals could prevent future consumers from entering onerous credit deals. However, they offer little help to consumers currently tied into these deals.

"It is vital that the government takes steps to ensure that people who most need fair and accessible credit are not driven underground into the hands of loan sharks.

"Furthermore CA continues to highlight the need for consumers to have access to general financial planning and unbiased financial advice. To do this, the Consumers' Association is campaigning for the government to establish a National Financial Advice Network.

"People in serious debt are often desperate and vulnerable and it is far too easy for loan companies to take advantage of this. Today's proposals will offer much needed protection for future consumers.

"These proposals are particularly welcome at a time of rising consumer debt, increasing pressure on consumers to save more for the future and economic uncertainty which could lead to rising numbers of consumers struggling to manage their finances."

Forum response: Barclays

Frederic Nze, consumer finance director for Barclays, told ePolitix.com: ""Barclays welcomes Melanie Johnson's announcement today, particularly on the need for transparency around loan agreements and clear information on charges and interest rates.

"Barclays is one of the few lenders who do not calculate loans using 'rule of 78' (where interest is calculated on a monthly basis rather than daily) and has no early redemption penalties. With 70 per cent of the UK population paying their loans early this makes a significant difference to the cost of the loan for the customer. When choosing a loan we urge customers to look beyond the headline rate."