THEORETICAL FOUNDATIONS FOR THE USE OF FINANCIAL AND CREDIT INSTRUMENTS FOR STIMULATE ENTREPRENEURSHIP DEVELOPMENT IN UKRAINE

Abstract

The growing importance of entrepreneurship in ensuring Ukraine’s economic stability necessitates research into effective tools for providing financial incentives to support it. The purpose of this article is to examine the nature and role of financial and credit instruments in stimulating the development of entrepreneurship in Ukraine, as well as to identify ways to enhance the effectiveness of their use in supporting entrepreneurial activity amid instability and military risks. Methodology: General scientific and specialized research methods were employed. Methods of analysis and synthesis were applied to determine the nature of financial and credit instruments and their role in stimulating the development of entrepreneurship. The classification method was used to systematize the main types of financial and credit instruments, while comparative and systemic methods were used to identify factors that hinder the effectiveness of their application. Results: It has been established that financial and credit instruments are a key component in stimulating the development of entrepreneurship, as they provide businesses with access to financial resources, support investment activity, and enhance business resilience. A general classification of the financial and credit instruments used in Ukraine has been presented. Particular attention has been paid to identifying the factors that hinder the effective functioning of the financial and credit incentive system for entrepreneurship development. A significant negative factor caused by the full-scale war is the deepening of regional disparities in the sphere of financial and credit support for entrepreneurship development, which manifests itself in the uneven access of business entities to financial resources for various purposes. It is argued that the combined impact of these factors limits the ability of business entities to attract financial resources for expanding their operations and modernizing production facilities. Originality/Value: Based on the conducted study, directions have been identified for improving the effectiveness of financial and credit instruments with the aim of stimulating entrepreneurial activity, strengthening the financial stability of business entities, and expanding their investment opportunities. It has been determined that improving the mechanism for financial and credit support of entrepreneurship development is of great importance for enhancing business competitiveness, fostering a favorable entrepreneurial environment, and ensuring Ukraine’s economic development as a whole.