In the paper, the financial sources used by small and medium enterprises (SMEs) in Slovakia to finance innovation are identified. The sources that are essential for SMEs are determined. Types of innovation the small and medium enterprises are investing their sources in are found out. To conduct the survey questionnaire was used. The results were processed by means of the Chi-square test. Introduction. The industrial policy of the EU stresses the importance of promoting innovation among European

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... companies as one of the key objectives of policy. This has led to the development of framework policies to promote pan-EU cooperation in R & D and other areas of technological development [7] . The development of a knowledge-based economy lies at the heart of these framework policies. The structuring of the European research area part of the program is seeking to build a European research base and accounts for approximately 16 per cent of the budget [26] . The framework programs are basically attempts to build pan-EU competence in major areas of research and technological developments and to promote a European ethos for such a research base. The framework programs have elements of seeking to build European champions in the area of research and technological competence [1]. The rationale for this would seem to be closely allied to the political integration driver of policy, as it is not clear that a European research and technological development base is preferable to a global or even a US orientated base [13] . Clearly, the USA is the technological leader in most of the thematic areas in the 6th Framework, hence linking to US research bases may be a more effective policy. If the objective is to develop European political institutions that foster research and technological development then the framework programs make sense. However, thus far the EU has not developed audit systems that test for the effectiveness, in terms of output relative to the US research base, of the framework programs [21]. Moreover, member states' governments maintain their own research and technological development programs often only marginally linked to the framework programs. As highlighted by EU Industrial Policy, industry is crucial for EU competitiveness and innovation is a key factor in this regard. Industry accounts for 80% of Europe's exports. Some 65% of private sector research and development (R&D) investment comes from manufacturing. Therefore, industrial modernization in Europe must be broad-reaching and include the successful commercialization of product and service innovations, the industrial exploitation of innovative manufacturing technologies, innovative business models. Studies show that those companies who prioritize innovation are also those who experience the highest increase in turnover [20] . Some 79% of companies that introduced at least one innovation since 2011 experienced an increase of their turnover by more than 25% by 2014. Small and medium-sized enterprises are a particular target for innovation policy. The smaller the company is, the more it faces constraints to innovation or to the commercialization of its innovations. Some 63% of companies with between 1 and 9 employees declared having introduced at least one innovation since Є. Іванова, М. Кордош. Інноваційна політика малих та середніх підприємств Словаччини в контексті інноваційної політики Європейського Союзу Маркетинг і менеджмент інновацій, 2017, № 3 Розділ 3 Інноваційний менеджмент Маркетинг і менеджмент інновацій, 2017, № 3 Розділ 3 Інноваційний менеджмент Маркетинг і менеджмент інновацій, 2017, № 3 Розділ 3 Інноваційний менеджмент Маркетинг і менеджмент інновацій, 2017, № 3