A Special Purpose Vehicle (SPV) is commonly established in project finance so that the project can be legally and financially separated from its sponsors, thereby improving clarity in risk allocation, security creation, and contractual enforcement. The main reason for creating an SPV is to:

Question

Banking · Project Finance

Verified Solution4 OptionsUpdated: October 2026👁️1 View

Share:

Correct answer

Isolate project risks and ring-fence project cash flows

Save this question and verified answer as a clean study sheet with live clickable link.

👥

Challenge your peer aspirants on WhatsApp or Telegram to solve this question!

Online Test Series

Practice full-length mock tests with real exam timers, instant score analysis, and all-India ranking.

Chapter Practice

Want more practice questions on Project Finance?

Solve complete topic-wise tests with detailed solutions on GkGet.

Recommended practice questions in Banking · Project Finance

Mahatma Gandhi's last fast unto death in 1948 was primarily against which of the following?

What was the primary meaning of 'Swaraj' as popularized by Mahatma Gandhi during India's independence movement?

What was one major impact of India’s independence on its economy?

Answer 1

Replace the need for concession and EPC contracts

Answer 2

Automatically obtain sovereign backing for project debt

Answer 3

Avoid all sectoral approvals and regulatory clearances

Answer 4

Isolate project risks and ring-fence project cash flows

Related Practice Questions