I guess that, if you have a rather limited understanding of economics, what you need is getting some intuitions.
Also, in this first part, I only deal with commercial banks. Note however, that only commercial banks create money while central banks emit/issue money (more about this difference in the last part). But how does creation of money work, is this creation real in the physical sense ?
Say I have a bike (money) and because I am not using it, I park it somewhere (commercial bank) someone can borrow it. However, if I need my bike, it must be where I left it. This is what the liquidity risk is about. In this case my bicycle is a conserved quantity, and the "parker" (banker) has a book, in which she writes that she has my bicycle:
bike1 ............................................ date-infos-etc
Thus the parker lends my bike and hopes that I am not about to come back to use it. But the borrower will also have to park the bike somewhere, because she will not use it permanently. And she parks it in the same parking. So the parker henceforth has what follows written in her book
bike1 ............................................ name1-date1-infos1-etc1
So the second bike, i.e. bike1' (actually the same as bike1), is scriptural. Thus quantities are scripturally not conserved.
But the effects on economic activities is anything but scriptural: me, I still enjoy the fact of having this bike, in term of solvency and so on. The borrower can use this bike to go faster (leverage effect to increase her income) than before.
When the borrower does not need the bike anymore, she informs the parker, who erases the second line in her book, which destroys the scruptural bike refered to as bike1'.
Thus money is an object whose quantity is conserved, but an object that commercial banks can duplicate/create scripturally until the liquidity risk becomes unbearable, i.e., until the probability that everybody wants to use the scriptural money at the same time becomes to high, which would be equivalent to the so-called bank run.
Following @Anasta's comments
To address the first comment. Creation of money by commercial banks is what I describe above. Briefly but strictly speaking, emission is the physical increase of money supply and this is the exclusive prerogative of Central Banks. Creation of money (thus what I am talking about in the first part of my answer), consists of duplicating scripturally this supplied money.
To address the second comment. In practice, the risk of liquidity is (semi-) unobservable, and cannot be managed perfectly. That is why there are standards on banks' minimum capital ratios: using my simplifying/intuiting example above, this capital ratio would be something like [ the amount associated to the first line written in the book ] divided by [ the total written amount (corresponding to the sum of all amounts reported in the book) ]. Also, as just outlined, the first asset (bike) is actually owned by the shareholders of the bank, which subsequently shifts the liquidity risk from the first line to the following lines. But theoretically, the process of scriptural creation can be infinite as soon as the book (above) contains one line (shareholders' equity), used to generate a second one, which could in turn be used to generate a third one, and so on. Indeed the capital ratio can converge asymptotically towards $0$. Theoretically (i.e. if the liquidity risk is perfectly managed) there is no hard constraint. Finally on this point, the constraint is only regulatory, and without it, banks would have the right to rush, soon or later, headlong into disaster. And as you mention, this minimum capital ratio is subjectively determined, and we should expect it to be upward pressured as centuries goes by.
To address the third comment. Printed money is nothing more than the emanation of a record, written somewhere. This is even more visible when you use your credit card: does the amount you type when buying something on internet have any sort of physical representation ? Physically not but scripturally it does. And, actually, if you were under the impression that there is no detectable difference between these two kinds of money (bikes), this is because the the "first" bike is also borrowed from someone else.
To go further
But who is the first/primordial lender ? First of all, note that it is impossible to go further without clearing up the prevailing confusion regarding the two following terms: creation versus emission, since expressed as such, the two underlying notions are incompletely rendered for people. Strictly speaking creation in the economical sense means scriptural creation -- and this is the core subject of my answer --, while emission in the economical sense means ex nihilo creation of central bank money in the common sense. So, as you can see, these two terms are deceptive cognates of their everyday-life usage.
Briefly (and still giving some intuitions), the first lender, historically, is a central-bank-like institution. And this institution, when printing money, appears as doing it ex nihilo. But in reality, these institutions turn human conceptions/psychology/beliefs into value. So saying that this generation of value is done ex nihilo is not correct strictly thinking. A (caricatured but not so far from reality) example is:
On the one hand, assume the existence of a country whose name is Gouzlouk. This nation has no installed capital, no infrastructure, no army, no productive system, no school, no no.
On the other hand, assume the existence of a country whose name is ASUK. This nation has a highly capitalized economic system, gold reserves, a powerful army, a highly productive system which produces things that everybody wants, and, specially, a currency that many other nations use as unit of value of their own monetary system.
It is obvious that, if Gouzlouk nation prints money from what is said to be nothing, it will really be nihilo, since nobody in the world economy will buy what they produce, since they produce nothing, and even if they produce something and sell it in their own currency, nobody will wants to buy their production since they would first have to buy Gouzlouk's currency, which even if almost free, gives access to nothing desirable. A contrario, if ASUK nation prints money, it won't be ex nihilo at all ! And given that every nation in the world have their pockets full of ASUK's currency, which gives access to anything you want, they will have no interest to undermine it. Furthermore ASUK's army owns missiles everywhere and the nation is headed by a trigger man.
Pablo Picasso was often found drawing on the paper tablecloths at his favorite restaurants. Restaurateurs would often ask him to leave the drawings instead of paying the bill.
Picasso was a central bank of his own.