How does the process of loan creation work in the financial industry?

In the financial industry, loan creation typically involves a bank or lender providing funds to a borrower, who agrees to repay the loan amount plus interest over a specified period of time. The lender assesses the borrower's creditworthiness and ability to repay the loan before approving the loan. Once approved, the loan is disbursed to the borrower, who then makes regular payments until the loan is fully repaid.