INNOVATIVE FINANCIAL TECHNOLOGIES IN FORMING A BALANCED ECONOMIC SECURITY MANAGEMENT MECHANISM FOR BUSINESS ENTITIES

Abstract

The modern economic environment is characterized by high volatility, increasing entropy of the macro-environment, and permanent instability caused by global digital transformations. Under such conditions, business entities face a fundamental management dichotomy: the need for intensive innovative development versus the imperative of maintaining a high level of economic security. Traditional paradigms of economic security, which are primarily focused on risk minimization and resource stabilization, often act as inhibitors of innovation due to the excessive bureaucratization of investment procedures and a "zero tolerance" policy toward risk, leading to the so-called "over-protection" effect. Conversely, uncontrolled innovation without a relevant protective contour creates critical threats to financial equilibrium and solvency. The research aims to provide a theoretical justification and develop a balanced economic security management mechanism for business entities based on the integration of innovative financial technologies (FinTech), capable of synchronizing development vectors with security imperatives. The study employs a systematic approach to conceptualize the interaction between innovation and security, logical modeling to design the structure of the management mechanism, and a criteria-based approach to formulate the mathematical basis for integral assessment. The research proposes a model of a balanced mechanism, where the FinTech integration core serves as the primary balancer. The operation of this mechanism is structured through three functional modules. First, the prognostic module utilizes artificial intelligence and machine learning algorithms to transition from retrospective analysis to predictive risk management, allowing for the objective determination of investment risk thresholds. Second, the transactional module implements blockchain technology and smart contracts to automate financial flows, ensuring transparency and eliminating the risks of bad-faith partnership. Third, the diversification module activates alternative financing protocols, such as crowdfunding and crowdinvesting, to distribute innovation risks and reduce the debt burden on the entity. To monitor the efficiency of the mechanism, an integral index of balance has been developed. The implementation of the developed balanced mechanism allows business entities to minimize transaction costs for security administration and significantly accelerate the commercialization of high-risk innovations without compromising the overall financial stability of the enterprise. The study shifts the security paradigm from a static state of preservation to a dynamic state of resilient growth.