The Housing Development Finance Corporation Ltd has approached the International Finance Corporation, for a $200 million loan to be raised in two tranches. Earlier, HDFC had postponed its plan for raising a second round of $100 million from the overseas market.

Under the scheme of arrangement, the first tranche of loan will be between $100 million and $150 million for a tenure of eight years. The second tranche will be between $50 million and $100 million for six years.

HDFC managing director Keki Mistry had earlier said that a reduction in the housing finance major's borrowing cost in the domestic market had prompted it to review the issue.

IFC was roped in for long-term funding to enable HDFC to extend the maturity of syndicated funding accessible internationally.

"Funds from the investment would be used by HDFC to extend its reach to the underserved middle and lower income segments of the population in India," according to IFC.

On the business front, HDFC's cost of funds has declined and the company has reduced rates on more than eight occasions by around 2.5 per cent.

Its cost of borrowing on an annualised basis was 6.5 per cent at present. HDFC postponed its international fund-raising plan as it could source funds from the domestic market at costs that were nearly at par with international levels.

Through IFC, HDFC would be able to borrow funds at rates that could well be below its present cost of funds. Around 45 per cent of HDFC's funds are raised from deposits, 17 per cent from bonds, 7 per cent from international funds and the rest is from banks and institutions.

HDFC was expected to attain 35 per cent growth in the current year, against the 30 per cent achieved in the first six months of the current fiscal.