It seems that you are asking about handwriting-to-text recognition. If so, i agree that its time that Apple add that feature. It exists in different ways in a number of iOS apps.
Nebo from MyScript does a decent job. For a time MyScript had an app called Stylus that was an alternative iOS keyboard but has been pulled.
I believe the feature exists in Notability. I would like to see the feature baked into the iOS.
Handwriting-to-text existed in the Newton Message pad 20 years ago and was rather good with the second version of that device's OS (i have a Newton 120).