A method for reducing the quantization effect of precoding operations utilizing a finite codebook in MIMO systems is provided. First, at the receiver side, downlink channel state information is obtained and a set of indices of precoding matrices within a plurality of finite codebooks are selected accordingly. The selected indices of precoding matrices for each of the finite codebooks and a set of scalar coefficients are transmitted from the receiver to the transmitter. Thereafter, at the transmitter side, at least a first and a second refined precoding matrices are generated based on the selected set of indices of precoding matrices for all of the finite codebooks, and the one or more scalar coefficients and a final precoding matrix is generated at least based on the first refined precoding matrix and the second refined precoding matrix. The final precoding matrix is applied for transmission between the transmitter and the receiver.