One of the main reasons companies use special-purpose vehicle finance is risk management. By creating an SPV, the parent company can separate liabilities associated with a specific project from its main balance sheet. This protects the parent company from financial losses if the project fails. SPVs are commonly used in infrastructure projects, real estate developments, and large-scale investment transactions.

Special-purpose vehicle finance is also widely used in securitization. In this process, financial assets such as loans or receivables are transferred to the SPV. The SPV then issues securities backed by those assets, allowing investors to purchase shares in the income generated from them. This structure helps companies convert illiquid assets into cash and improve liquidity.