Mahiti promotes the formation of community-based institutions and supports their functioning in a variety of ways. A large number of these (more than 375) are self-help groups (SHGs) whose purpose is to pool financial resources through small monthly contributions and serve as a support group for members. This encourages savings and gives members access to sums of money that would enable a diversifying of livelihood options. We organize families into SHGs, to discuss, monitor and evaluate their functioning, and to help them liaise with banks and government departments. We believe that it is important for the SHGs to be self-sustaining.

One specific concern is for interest rates to be lowered so that people feel encouraged to take loans. Over the years there has indeed been a downward revision in rates though there is much regional variation in this regard (5–18 % per annum – simple interest). There is also regional variation in the purposes for which loans have been taken. They range from traditional and non-traditional income generators (agriculture, animal husbandry, saree trading, diamond polishing, flour mills, brick kilns, tiny shops etc) to miscellaneous personal expenditure (in health and education, for instance). The latter is more prevalent in the poorer SHGs, a significant number of which fall in the both the districts - Ahmedabad and Bhavnagar.