Kerala Becomes Country’s First Fully Digital Banking State

January 10, 2023

Kerala has become the first state in India to enable digital banking in all eligible accounts. According to the State-Level Bankers’ Committee (SLBC), the state now has at least one product enabled digitally in 3.76 crore accounts. The state government, led by Chief Minister Pinarayi Vijayan, has implemented this move under the ‘Expanding and Deepening of Digital Payments Ecosystem’ scheme of the Reserve Bank of India (RBI).

Thrissur: The First District to Implement Digital Banking

In 2021, Thrissur became the first district in Kerala to implement digital banking under the scheme. This has been a major step towards digitization of the state’s economy, and the government is hopeful that this will lead to a significant boost in the state’s economy.

Digital Banking as a Stimulus for the State Economy

The Chief Minister, Pinarayi Vijayan, has emphasized that digital banking targets can only be fully achieved when there are sweeping social interventions that complement infrastructure additions and technological advances in the banking sector. He said that the digital divide should disappear for digital facilities and services to be universally accessible.

Kerala Fiber Optic Network (KFON)

The state government has been working on the Kerala Fiber Optic Network (KFON) project, which is aimed at providing cost-effective internet access to the public. The Chief Minister has announced that 90% of the work on the project has been completed and that optical fibre cable has been drawn over a distance of 17,155 km. The project envisions linking government offices to the network and arranging over 2,000 free Wi-Fi hotspots across the state.

Cybercrimes and Digital Literacy

The government is also aware of the need to be vigilant against cybercrimes in the banking sector. The state police has created an Economic Offences Wing to tackle such offences. However, the government has stressed that preventing cybercrimes through public awareness and cooperation of the banking sector is of paramount importance.

To raise digital literacy among citizens, the government has undertaken a programme through local bodies. Kerala has won three awards at the recent Digital India Awards instituted by the Department of Electronics and Information Technology, Government of India, which is a testament to the state’s commitment to implementing efficient digital mechanisms.

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