If charging interest created money out of thin air, then so do credit card companies, car dealers, etc.
I'd say we have to look deeper to truly understand what is going on. First of all, what is money? A medium of exchange for goods and services. Paper money, also called fiat money, used to be backed up by gold and silver, things that are valuable in and of themselves. (Why they are considered valuable in and of themselves is another philosophical question)
Fiat money is no longer backed by gold and silver, but by the full faith and credit of the US government.
So the question is, does the system we currently have work? Yes, so far it's working ok. Could be better, but it's the best we have for now. We got rid of having to carry around gold and silver for our transactions, and now we've even moved on to digital exchanges. Money is now more a ledger of assets, purchasing power, and debt than anything else.
The problem with interest is a question of resources. The economy dramatically increased with the industrial revolution and the rapid increase in manufacturing goods. Population grew rapidly following advances in many other areas of life, such as science, engineering, medicine, and so on. Quality of life increased for many.
Then came the most important economic discovery of them all, oil. This is what really skyrocketed society to where it's at now. Transportation, agriculture, plastics, and anything else oil touches directly or indirectly is why we live in the modern world we do today. Oil is such a bountiful, easy to extract source of energy, that our global economy at it's heart is based on oil. It's not infinite, however.
The problem is oil is a finite resource, and as easy reserves get used up, it becomes more difficult and costly to drill for it. So we still have plenty, but our economic system of perpetual growth through the charging of interest is fundamentally flawed, as there will be a day when there will be and can no longer be a continual growth in the production of goods and services. Both because of oil's increasingly difficult to access nature, and the depletion of natural resources.
Many other factors are involved, such as global warming and a rising population, which further accelerate the depletion of natural resources available. We can't study economics without considering the underlying foundation for it, and it matters that we live in a planet with finite resources, yet expect unimpeded, perpetual growth. This is reflected in the charging of interest on loans, in a business as usual way of operating things.