The 50-year-old mother apparently received a call from her young daughter's teacher, who told her that the girl had borrowed money from a friend during a trip to the school and refused to give it back.
She allegedly confronted her daughter, who lied about the money, and then left to fetch a wooden spoon.
She found her daughter holding a piggy bank containing her friend's change, it was said.
Speaking to a jury at Croydon Crown Court, the mother claimed she then gave her daughter three warnings to stop "scratching the piggy bank".
After the third warning, she says, she then gave the little girl a "gentle tap" to make her stop.
However Deanne Heer, the lawyer for the prosecution, said that the daughter "has described 20 or 30" occasions in which her mother hit her with the kitchen implement.
She also said that the mother had lost her self-control during the incident.
After the wooden spoon was used, the mother admitted that she noticed a blister on her child's hand - and quickly took her downstairs to apply ice.
A little while later, the child told her teachers about what had happened and police became involved.
The mother denies three counts of cruelty to a person under the age of 16. The trial continues.