Take a basic look at the role of a financial interest group, and it can be hard to see why they have become quite so controversial in certain quarters. Put simply, the purpose of a financial interest group is to represent the interests of its members, be they banks, major corporations or ordinary members of the public, to the people with the power to make things happen. This may seem fairly straightforward, but the power and influence that these organisations have can cause a significant backlash from certain other individuals and groups.
It’s best to look at a specific example, to understand just what power these groups can have, and how they use it. Imagine that you’re running a company that is planning to launch a new service tracking crypto coin values free of charge. If these services are currently only provided by companies that make a significant income from charging for the service, then it is in their interests to spend a considerable amount of time and money on lobbying so that it is more difficult, if not impossible, for you to enter the market. They may claim that the information you are providing will not be reliable enough and therefore should not be available or should not be used for any official purposes.
This may sound like an extreme example, but it is the heart of the reason why banking and other financial sectors around the world are non-competitive. The existing players are able to make the barriers to entry very high, which means that new companies are unable to get into the market and force them to reduce their prices or improve their services.
This is why some governments have chosen to regulate these types of financial interest groups, in an attempt to stop them from becoming too powerful.