The borrower and lender are never meet. The lender gives money to a financial intermediary who lends to the borrower. The financial intermediary has a direct claim against the borrower, but the lender has only an indirect claim against the pool of loans made by the financial intermediary. The financial markets are divided into two separate markets based upon the date of issue of the financial instrument. The primary markets are the markets for new issues.
Investment banks make the primary markets.
They buy new issues from borrowers and find buyers for these new issues. Money raised in the primary markets is used by corporations to buy new capital or by governments to finance new deficits. The secondary markets are the markets where outstanding issues are resold. No new money is raised by the resale of existing issues. Money from the resale may be used by savers to buy other financial instruments or by consumers to buy real goods and services.