Kudumbashree plays a vital role in enhancing the financial status of the less privileged women in the State through its thrift and credit program . The small regular savings of neighborhood groups are pooled together and given out as internal loan to the most deserving member of the group. These loans acted as a leveler to address the immediate financial shocks of the group members.
The function of thrift and credit is the core activity of the Kudumbashree neighbourhood group (NHG), and forms the basis of the weekly meetings of the NHG. The amount of loan and the priority of disbursement are decided by the NHG. The repayment is collected weekly during routine NHG meetings.