Phase-transfer catalysts facilitate the transfer of reactants between immiscible liquid phases, allowing reactions to occur. They are commonly used quaternary ammonium or phosphonium salts. The catalyst transports one reactant from the aqueous phase to the organic phase where it can undergo a nucleophilic substitution reaction. This allows reactions to be carried out using cheaper and more environmentally friendly reagents like NaOH instead of organic solvents. Phase-transfer catalysis finds applications in industries like pharmaceuticals, perfumes, polymers, and pesticides by enabling mild reaction conditions.