The usage is just fine:
OK
used to express assent, agreement, or acceptance.
-- Oxford
By saying OK the listener is acknowledging they agree or accept what has been said, which by definition implies they understand it.
Another idiomatic expression you could use is:
I see
also, I see what you mean. I understand...
-- Farlex, Idioms.
If you do not want to interrupt the flow of the speaker you could also use non verbal communication. For example a nod of the head, or a simple smile, can be used to demonstrate that you are following along with what the speaker is saying.
mm...hm...oraa...ha...? – May 20 '17 at 15:33OK they say, is just an expression - I quote, there - It doesn't mean I think it's alright; it's just a figure of speech…
– Robbie Goodwin Jun 02 '17 at 21:40