Illya Gerasymchuk
Entrepreneur / Engineer
banks are credit institutions which means they can create broad money while a non-credit institution or a regular business can issue loans - they must fund it (e.g. raise money, use excess profits) they can't just create those $100, thus expanding the monetary supply
so the bank funds the loan by creating $100 and crediting them to your account those $100 that they credited you did not exist before - the bank created that money on demand those $100 are not physical cash - they're an entry in a digital ledger (i.e. in a computer system)