Cook the diced banana, with sliced small onion (2), chopped green chillies, ginger, garlic and salt. Bring it to a boil and let it simmer till the banana is cooked.
Grind together coconut, cumin and turmeric powder with 3-5 tbsp of water to a smooth paste. Start grinding with 2-3 tbsp of water and add more if required.
Combine the whisked yogurt and coconut paste. Remove the cooked banana from fire and add the yogurt coconut mixture. Mix well. Bring it back to fire and let it simmer. Stir continuously until steam comes from the back of the spoon, around 5-7 mins.
Heat oil in a small pan and crackle the mustard seeds. Add sliced small onion (3) and curry leaves. Fry it till the small onion turns golden brown. Add this to the curry.
Notes
You can also use medium ripe ethakka (Kerala banana) to make this. I've seen some people using a combination of vazhakka and ethakka.Also in some places chena (yam) is also added along with banana to make kalan. The gravy tends to thicken as it rests. While reheating, it's better to use double boiler method, otherwise it may curdle.