in direct finance and indirect finance entities trade securities like stock and bonds and not directly money like giving loan but not taking bonds i mean simple giving loans and taking words like " i will pay you back later"

It seems like you're asking about the difference between direct and indirect finance, and how securities like stocks and bonds come into play. Here's a step-by-step explanation:

1. Direct Finance: This occurs when borrowers borrow funds directly from lenders in financial markets by selling them securities. Securities are assets for the person who buys them but are liabilities for the individual or firm that sells them. For example, if a business sells stocks or bonds directly to investors, the business is borrowing money from the investors who become lenders.

2. Indirect Finance: This occurs when a financial intermediary is involved between the lender and the borrower. The intermediary borrows funds from the lender and then uses these funds to make a loan to the borrower. For example, a bank might take deposits from savers and then use that money to give loans to businesses or individuals.

3. In both direct and indirect finance, the trade is not typically in 'money' like a simple loan, but rather in securities like stocks and bonds. These securities represent a promise to repay the amount borrowed, often with interest.

4. When you mention "giving loans and taking words like 'I will pay you back later'", this sounds more like an informal loan agreement rather than a formal financial transaction involving securities. This would not typically fall under the categories of direct or indirect finance as it lacks the formal structure and legal obligations associated with financial markets.