A watercraft is provided with fin on its transom. The fin extends outwardly from a portion of the transom that extends into the water. The fin includes a first portion and a second portion positioned rearwardly of the first portion. The second portion is inclined downwardly and rearwardly relative to the first portion and positioned so as to provide lift and to channel water toward the propeller. The watercraft may be a pontoon boat having first and second laterally-spaced pontoons located under the deck on opposite sides of the transom. Additional fins may be mounted on the first and second laterally-spaced pontoons.