Financial transfer has the functions of allocating financial resources and income redistribution, which is of great significance to reduce the income gap. From the perspective of financial transfer, based on the panel data of 31 provinces in China from 1998 to 2019, this manuscript introduces the bilateral stochastic frontier method, constructs a measurement model of farmers’ income distribution including the influence channels of financial transfer, and tests the effect of different financial transfer channels on Farmers’ income distribution. The empirical results show that the financial transfer within the sample interval increases the income distribution of farmers, which shows the distribution characteristics of “differentiation at both ends and convergence in the middle” in general. There are obvious differences in the impact of different financial transfer paths on Farmers’ income distribution. Farmers’ income distribution is directly proportional to inflation, and inversely proportional to financial and educational expenditure and rural economic growth. Under the two characteristic factors of regional factors and rural financial development level, the impact of financial transfer on Chinese farmers’ income distribution shows heterogeneity.