Over the past few decades, various risk management models have been developed and implemented, primarily benefiting large businesses. However, a comprehensive framework for financial risk management tailored to small and medium-sized enterprises (SMEs) remains lacking. This research introduces an innovative conceptual framework for financial risk management in SMEs, focusing on two key dimensions: organizational structure and the risk management process. Each dimension comprises several components, with each component containing one or more elements. Using Principal Component Analysis (PCA), weighting factors are determined to calculate scores at different levels. To address the imbalance between dimensions, a disparity factor is incorporated into the result. Additionally, the study highlights the positive impact of the risk manager’s educational background as a significant factor influencing both the dimensions and financial risk management outcomes