Despite the fact that the Reserve Bank of India has agreed to not implement the proposed base rate mechanism for at least another three months, the country's banks still do not seem to be very happy or comfortable.

Giving ear to the many requests sent in by banks, RBI today said that the implementation would not happen till June 1, but the bankers still feel that there is much confusion on calculation of cost of deposits, which is an important element for calculating the rate to begin with.

As per the formula proposed by the RBI, base rate would be calculated based on the banks' cost of deposit, adjustment for the negative carry as far as the cash reserve ratio went and the statutory liquidity ratio, overhead costs and the margin of profit.

The idea behind this is to make it possible for base rate to vary from one bank to another. Not only will this, in my opinion, be a good news for the banks (less confusion), but also customers, who can go ahead and pick the bank which offers the best rate according to their requirements and preferences.

Banks have also been given full liberty, and they can calculate their base rates based on a number of factors.

In wake of the global financial crisis, it seems like the RBI is all set to make things as convenient and simple for banks and customers as possible. As far as the confusion goes, the central bank is all set to offer lots of clarification when the final guidelines are issued, which is expected to happen anytime soon.

The recession had not hit India that bad to begin with, but it seems like whatever little effect it had did manage to push the RBI into adopting simpler policies and rates, which are for the betterment of the banks of the country as well as the general public.