<![CDATA[In the era of globalization and digital transformation, product innovation has become a key factor in the competitiveness of Small and Medium Enterprises (SMEs). However, many SMEs still face limitations in financial management and sustainable innovation. The SME "Dapur Gizi Keripik Lumba-Lumba" in Malang City serves as a clear example of how financial management can drive the innovation of local products based on healthy food ingredients. This study aims to interpret the role of financial management in supporting the development of innovative products and to identify the factors influencing its effectiveness. The method used is a qualitative case study with primary data collection through interviews and direct observation using purposive sampling, along with relevant secondary data from literature studies. Data analysis was conducted through three stages: data reduction, data display, and conclusion drawing. The results show that financial management in this SME has transformed from a transactional recording function into a strategic pillar driving healthy product innovation. Its effectiveness is supported by the synergy of the owner's vision, budgetary discipline, and technological integration, which mitigate financial risks while optimizing capital allocation as a long-term investment. Funding is no longer viewed as a cost burden, but rather as an instrument to build a healthy lifestyle-based product identity. Through measurable financial governance, the SME strives to accelerate adaptation to market trends and ensure operational sustainability in the processed food industry of Malang City.]]>
