Bankers warn interest-free credit cards are a ‘ticking time bomb’ 

Situation could lead to the kind of revenue scandal that hit supermarket Tesco

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Interest-free credit cards are a “ticking time bomb” and bankers are sounding the alarm. That’s because lenders that offer zero per cent balance transfer cards book upfront some of the revenue that they expect to gain once a customer ends the interest-free period and starts paying a high rate. But that assumes customers will still have debt on the card when the deal ends. 

Longer interest-free periods and an increase in loan limits are contributing to the fastest rate of expansion in consumer credit since 2005. The Bank of England this month expressed concern about what this means for lenders. One banker compared the situation to the Tesco scandal in 2014 that cost Britain’s biggest grocer at least £214m in fines for overstating profits. (FT, Guardian)

In the news

Reanimate Nafta by reusing TPP Mexico is urging Donald Trump to reuse agreements reached under the aborted Trans-Pacific Partnership to create a manufacturing powerhouse between the US, Mexico and Canada to compete with low-cost producers in China. “A package is already in your pocket,” Ildefonso Guajardo, Mexico’s economy minister, said. (FT)

Elsewhere in Trumpland It was a big weekend for the Trump administration, which has now passed its first 100 days. Donald Trump left open the possibility of military action against Pyongyang (whose apparently formidable force is beset by an array of problems), and gave contradictory messages on who would pay for a missile-defence system in South Korea. Finally, the US Congress on Sunday reached a deal to keep the government open through to September. (FT, WSJ, WaPo)

Fox and Blackstone team up Rupert Murdoch’s 21st Century Fox is in talks with Blackstone, the private equity firm, to launch a joint bid for Tribune Media. They hope to trump a rival offer from Sinclair Broadcasting for the $3.2bn company. (FT)

May sticks to guns on trade The UK prime minister called for a full UK-EU trade agreement within the two-year “divorce period” — alarming European leaders who had thought she was merely aiming towards a preliminary deal on the “future framework” by 2019. This has sparked fears that the gulf between the opposing negotiating positions is wider than thought. (FT)

Le Pen plays down anti-euro message Far right French presidential candidate Marine Le Pen has indicated her flagship policy of leaving the euro is no longer a priority, an attempt to broaden her mainstream appeal ahead of the election this weekend. France will be on extra high alert on Monday as workers and protesters use the traditional May 1 marches to stage a show of force against Ms Le Pen. (FT, Guardian)

Turkey’s crackdown grows President Recep Tayyip Erdogan expanded his crackdown on dissent and free expression over the weekend, bringing the total number of people purged from the public and private sector to 140,000, and banning Wikipedia. (NYT, FT)

It's a big day for

Hollywood The entertainment industry is bracing for a potentially damaging writers’ strike that would disrupt television and film production schedules and hit revenues as the biggest media companies prepare to sell their advertising for the year. (FT)

India-Turkey relations Turkish President Recep Tayyip Erdogan will be meeting Prime Minister Narendra Modi meet in New Delhi to discuss strategic issues, including India’s Nuclear Suppliers Group (NSG) membership bid and counter-terrorism co-operation. Here are 10 things to watch. (IndiaToday)

Keep up with the important business, economic and political stories in the coming days with the FT’s Week Ahead.

Food for thought

Disruptive synergies in corporate gobbledegook Lucy Kellaway takes aim at a statement by Mondelez, the producer of Oreos and Creme Eggs, which managed to cram 10 clichés into a single sentence. “Instead of trotting out clichés, the company should have said it was hiring, not yet ready to name the replacement — and left it at that.” (FT)

Fisheries at the brink Overfishing is depleting oceans around the world — 90 per cent of fisheries are fully exploited or facing collapse — and China’s growing wealth, deep-sea fishing fleet and appetite for seafood are exacerbating the problem. (NYT)

Why a speech from Barack Obama is worth the expense “You don’t pay $400,000 a speech because you want to hire President Obama — you pay it because you want to be the kind of guy who can hire President Obama.” (FT)

Soaring cost of cancer drugs It is one of the most contentious and sensitive disputes in the US healthcare sector, with Americans paying much higher prices than those living elsewhere in the world. Doctors have to act as financial planners to find treatment that patients can afford. (FT)

China takes on Wikipedia Beijing has felt an urgent need to “guide and lead the public and society” through the creation of a digital encyclopedia — all in line with Xi Jinping’s instructions of course. More than 20,000 scholars are involved with the country’s biggest publication project, which will compete with the partially banned Chinese Wikipedia site. (SCMP)

What bullets do to bodies Meet the trauma surgeons who believe that the seemingly impenetrable US gun debate would change in an instant if Americans witnessed the horrors they confront every day. (HuffPo)

Video of the day

How to...detox from your smartphone Six out of 10 adults in the UK told Ofcom last year that they felt “hooked” on their smartphones. Emma Jacobs, FT work and careers columnist, shares her digital detox tips. (FT)

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