What is Uniswap V2 factory?

Could you please elaborate on what exactly the Uniswap V2 factory is? I understand that Uniswap is a decentralized exchange protocol, but how does the V2 factory specifically fit into the picture? Is it a smart contract that facilitates the creation of new liquidity pools, or does it serve a different purpose entirely? I'm curious to know more about its functionality and how it contributes to the overall Uniswap ecosystem.