Abstract: Let the transaction cost be the main study line of the rural financial products and service innovation, which should be designed to meet the "three agriculture" characteristics and requirements, and can effectively save the transaction cost of financial institutions with solving the problems of rural finance. Using the middle layer theory, the rural cooperatives was analyzed as the middle layer between rural financial institutions and farmers, and the conclusion was gotten that this structure can both save transaction cost and increase overall welfare. It could demonstrate the effectiveness of innovation of rural financial product based on farmer organization innovation.