In a combo, a “loop” is a sequence that can be repeated a (or any) number of times.
There are obviously going to be characters with more damaging combos than others, but when combos can be done limitlessly, they become an infinite combo.
Even more problematic, some games have loops with high throughput, or the capacity to be overly effective (such as guaranteed guard crushes). Certain games will take measures to regulate simple loops, but in most combo games these days, they are well-tolerated by the game systems.
Some loops can a repeated sequence, but a few of them are the same move over and over again. While most loops are difficult to perform in the first place (which is why they go into a released game usually undiscovered), the latter case is basically an exhibit of very poor quality checking during development.