On the basis of defining the connotation of the transformation and upgrading of small and medium-sized enterprises (SMEs), combining with the practice of the SMEs transformation and upgrading in Shaanxi province, with the intention of solving financing demand in the process of transformation and upgrading of SMEs, this paper analyzes emphatically four common transformation and upgrading connotations of the and its financing demand characteristics including management transformation, business model transformation, industry transformation and enterprise upgrading for SMEs in Shaanxi province, and discusses the characteristics and advantages of Internet finance means including P2P (Peer to Peer) lending, crowd funding and e-commerce finance when solving the problem of the financing demand and proposes a feasible strategy for the bottle-neck of financing from a new perspective. Based on this analysis, this paper further proposes the policy advice of making full use of Internet finance as means, and combing SMEs, Internet finance enterprises and government working together to promote the transformation and upgrading of SMEs.