A little bit more detalization for correct answer by Nicolas Lykke Iversen:

Go to the terminal:

root@kali: mysql -u root -p
enter password 'toor'
MariaDB [(none)]> use mysql;
MariaDB[(mysql)]> create user 'user'@'localhost' identified by 'password';
MariaDB[(mysql)]> grant all privileges on bWAPP.* to 'user'@'localhost' identified by 'password';

Go to /var/www/html/bWAPP/admin/settings.php and set:

$db_username = "user";
$db_password = "password";

Then go to http://localhost/bWAPP/install.php and install it.

A little bit more detalization for correct answer by Nicolas Lykke Iversen:

Go to the terminal:

root@kali: mysql -u root -p
enter password 'toor'
MariaDB [(none)]> use mysql;
MariaDB[(mysql)]> create user 'username'@'localhost' identified by 'my_password';
MariaDB[(mysql)]> grant all privileges on bWAPP.* to 'username'@'localhost' identified by 'my_password';

Go to /var/www/html/bWAPP/admin/settings.php and set:

$db_username = "username";
$db_password = "my_password";

Then go to http://localhost/bWAPP/install.php and install it.

PS: username & my_password - you may use any words you like