As the development of green and sustainable finance continues，the scope of support from financial resources extends across the entire spectrum of sustainable development and is not limited to supporting green industries. In the process of achieving a net-zero transition，transition finance has thus been gradually extended to financial services that support carbon-intensive industries in achieving a low-carbon transition. Transition finance at the sectoral or industry level is mainly defined by a transition taxonomy（or framework）proposed by government departments or regulators to define transition activities. At the level of transition entities，business entities formulate transition plans，implement corresponding transition measures and conduct transition disclosure and assessment according to the transition pathway. Financial institutions in which net-zero transition is achieved by adjusting their portfolios. The rapid development of transition financial instruments represented by transition bonds and sustainability-linked bonds will not only provide financing，but also help business entities to cope with transition risks and enhance their competitiveness in the changing low-carbon economy. However，there are transition finance challenges in terms of awareness of net-zero transition，transition criteria，market size and information disclosure，and there is a need to raise awareness of transition goals，harmonize transition taxonomies，foster a market environment for transition finance，and incorporate transition considerations into sustainable information disclosure when it is still in development in order to address the challenges of development of transition finance in the future.