The Group will devise products to help consumers navigate the financial services market more easily.

The chair of the Group will be Carol Sergeant, former chief risk officer for Lloyds Banking Group and former managing director of the Financial Services Authority.

Representatives from the Government, industry and trade and consumer bodies will support her.

It will look at how to bring simple products to the market and how simple products are structured and marketed to ensure customers get the best deal.

The first products the Group will be focusing on are simple deposit savings and protection insurance products.

Mr Hoban said: “ Simple financial products have the potential to help many consumers make decisions that will help them save for the first time and plan for a secure financial future for them and their families.”

Ms Sergeant said: “Simple, easy to understand products need to be a viable commercial proposition for the industry, while offering consumers a straightforward benchmark that gives them the confidence to make good decisions in an often bewilderingly complicated marketplace.

“Getting this right will require the involvement of consumer groups, financial regulators and the Money Advice Service as well as the savings, investment and protection industries.”

The move to arrange a Group follows a consultation on simple financial products. The Government hopes that the development of simple financial products will encourage people to take responsibility for their finances and make better choices.

The Group will report back to Mr Hoban in July 2012.