Kerala Becomes First State In India To Go Fully Digital In Its Banking Service

Kerala announced to the public on January 7 th , 2023 as the first State to be fully digital in its
banking services. Apart from this, Kerala also received three digital awards for its advancement
in the digital sector: the Ksheerashree Portal received a silver medal, the digital workforce management system received a platinum award, and the district administration of Kottayam received a gold medal. Furthermore, Kerala becomes the first state in India to have its internet service, which will aid in closing or narrowing the digital divide among Kerala residents. According to the State-Level Banking Committee (SLBC), at least one product is available digitally in each of the state’s 3.76 crore accounts.

The Kerala Chief Minister, Pinarayi Vijayan, believes that this scheme will aid in the growth of
the state’s economy. This is only possible with state intervention via local self-government institutions, as well as infrastructure development and technological advancements in the banking sector. The Kerala government has taken many steps to make sure that this plan is implemented properly all over the state. The first step towards full digital banking is to decrease or completely remove the digital gap among citizens by making digital services universally accessible.

The government of Kerala has implemented the Kerala Fiber Optic Network (K-FON). This project ensures that the internet is available for everyone at an affordable or free cost. As per the Chief Minister of Kerala, 90% of the work for this project is done. The optical fiber cable has been drawn over a distance of 17,155 km. The project visualizes linking government offices to the network and also provides 2000 free Wi-Fi spots across the state.

This move towards digital banking has been implemented under the “Expanding and Deepening
of Digital Payments Ecosystem” schemes of the Reserve Bank of India (RBI). The Chief Minister,
has stated that digital banking targets can only be fully realized if there are broad social interventions that complement infrastructure additions and technological advances in the banking sector. Also, the most important is the removal of the digital gap so that these digital facilities will be universally accepted.

One of the issues that this project is facing is the chances of an increase in cybercrime due to
the full digitalization of the banking system, but the state government has taken measures by
implementing or creating an Economic Offense Wing for the state police, which will help in
tackling the cybercrime cases. The government has already warned the banking sector to be
vigilant against cybercrimes. The government decided to give paramount importance to this issue first; it will prevent it through public awareness and the cooperation of the banking sector. The government has undertaken the program by conducting digital literacy programs through local bodies among the citizens.

Thrissur became the first district to completely adopt the fully digital banking service in India,
followed by Kottayam, Palakkad, and then other districts. While India is implementing 75 fully digital banking branches across the country, including allocations for rural areas in the 2022–2023 budget, Kerala claims to be the first state in India to go fully digital in its banking services. Kerala is the only Indian state that has declared “the right to the Internet” to be a fundamental right of its citizens. Only when rights can be exercised do they become meaningful. The Kerala Fiber Optic Network project is an attempt to ensure that Internet-based services are available to all Keralites as a right; it is a goal to close the digital divide.

The government also decided to raise awareness about online fraud, which may increase as a result of the implementation of this digital banking system. People are warned against it, and since the adoption of a fully digital banking system, taking measures to educate and make people aware of online fraud has become an important task for the Kerala government.

-By Harsha S, The writer is a student of Journalism at Madras Christian College and former intern, VeKommunicate.