There were two kinds.
Mums and toddler groups where the mums stayed. They were in church halls or community centres and were really aimed at isolated and lonely mums. There were toys for the children to play with, but the purpose was to support mums.
Playgroups were staffed play activities for under fives and mums did not stay. They took 3 and 4 year olds, occasionally 2 year olds, but not younger. I worked in one as a 17 year old. They usually only offered morning or afternoon session, and children only attended morning or afternoon and sometimes just one day a week right up to 5 days a week. There was no early years curriculum then, but they offered a wide variety of free flow play activities, including arts and crafts, messy play and outdoor play. Their aim was to give children access to activities and socialisation they otherwise would not get. Some mums did use them for childcare for part-time work, but some were used by SAHMs. Some playgroups also took referrals from Social Services for families who were struggling and needed respite. The kind of SAHMs who put their children in a nursery part time for activities and socialisation also did the same with playgroups.
The playgroups tended to be very cheap. When OFSTED came in some could not meet the requirements, most often building requirements for number of toilets, requirements for the kitchen, and staff ratios, and so closed. Kitchens especially were often an issue as playgroups tended to give a snack but not a meal, but full childcare required a proper lunch and sometimes dinner. But others became full time childcare. Playgroups were often small and I know some closed because they did not have enough space to take in enough children to make childcare pay - economies of scale. Playgroups also lost the 4 year olds to school pre nurseries and this made them less economically viable.
Playgroups were basically like nurseries, but without the hours necessary for childcare.