Singular value decomposition (SVD) can be used to compress images by decomposing images into orthogonal matrices and a diagonal matrix. This decomposition allows images to be approximated using only the first few terms in the decomposition series, reducing memory usage. However, there are limits to the compression rate that can be achieved while still saving memory. The rank of the approximation must be less than mn/(m+n+1) for memory savings, where m and n are the image dimensions. Higher ranks improve quality but also increase memory usage.