Is money creation different now that most currency is digital?
I learned in my basic economics class that banks create money by issuing loans. People put their money in the bank and said bank keeps a ledger of how much money each person has. In the past, the money was physical, which meant that the ledger and money were separate things. This means that when a bank "created" money with loans they were changing the ledger, and stating on it that, in total, their depositors have more money than they actual hold. This means the money they "created" isn't the same as actual currency. It doesn't actually exist, but effectively does because the actual amount of currency used in the economy is less than the amount that theoretically exists because of loans.
But now money is money is mostly digital, which means that the vast majority of money is exists because a digital ledger says so. Because most transactions are also digital (meaning banks just change their ledgers when a transaction occurs), there is no need for any amount of real currency to back the values on the ledger. In short, because the currency only exists on the ledger, when banks change that ledger when they create loans they should literally be creating currency in the same way a central bank prints money.
I feel like I'm missing something. Am I wrong?