That is what the average person thinks what happens but in reality the bank does not even care about your deposit. What actually happens is that the bank just creates a new money from thin air by just adding another zero their account and then transferring some of that new money to the person who wants a loan.
The US fed does this too, they add a zero at the end of the existing account and create more money. Its all in a database no cash is being printed.
The US fed does this too, they add a zero at the end of the existing account and create more money. Its all in a database no cash is being printed.