It is hard to believe that as many as 200,000 people are in the grip of violent loan sharks such as John Kiely, who was jailed this week for five years .

Yet that is the latest estimate of how many vulnerable people risk intimidation, assault, rape and even murder in order to borrow money.

Why are there so few options for those on benefits or low incomes to borrow money safely? It has simply not been a priority for the Government to come up with one.

Ministers made much of the Universal Banking Service they introduced in 2003 to allow benefits to be paid electronically. That may have increased access to no-frills bank accounts, but it has not provided any solution to the menace of the loan sharks. Loans to the poor are too risky, too time-consuming and too small-scale for the banks to bother with, and no one in authority has told them to mend their ways.

Despite warm words from politicians, community-based credit unions have failed to flourish. There are 690 of them in all, but they struggle to attract deposits, meaning that their ability to lend is limited. They also have a worryingly low profile. Only those already well plugged into community services would have even heard of their local credit union.

Legislation to make these organisations easier to join and more attractive to a wider range of customers is trundling its way through Parliament, but the reforms will not come into effect until the autumn at the earliest, and the crisis is now.

Contrast that with the US, where community development credit unions have developed quickly in the past decade to become the main community banking service for low and moderate-income Americans. They mobilise assets of $2.7 billion (£1.6 billion) a year and provide affordable credit to almost a million households. New low-cost loans are estimated to save members more than $300 million annually in interest charges from loan sharks.

The Government needs to do far more to promote credit unions here. The Post Office is looking for a new role and could easily offer credit unions the outlet that they desperately need. It is almost a perfect fit. The Post Office has a nationwide branch network but no products for low-income borrowers. Credit unions have an affordable product range but no branch network.

Local authorities could offer facilities and help with start-up costs for new credit unions in areas troubled by loan sharks.

The authorities must also be prepared to take this violent and illegal trade more seriously. Two special units have recently been set up and are getting results, although the conspiracy of silence between frightened borrowers and criminal lenders remains a big obstacle for investigators.

Times Recommends

• How I lost the gift of joy for a while
• Why Ann Widdecombe has got it wrong
• Alas, it’s the end of the road for petrolheads