Abstract: Financial innovation consists in the design, development, and implementation of innovative financial products, processes and services, and the adoption of innovative alternatives to address issues in finance. The purpose of this study was to establish the effect of product and process innovation on financial performance of Umwalimu SACCO in Rwanda. A census using a closed ended structure questionnaire to obtain both qualitative and quantitative data was conducted on 30 branch managers of Umwalimu SACCO across the country. The data thereof obtained was processed and analyzed for descriptive and inferential statistics by use of SPSS version 23.