Do not borrow money to people, if you must, consider it a donation instead !
Years ago I had an ex colleague who approach me for a business loan to fund his starting bakery in Pudu Impian. He initially ask me for a simple loan like RM500 and would say that he would pay me back in 1 months time which he didn't. After which, he asked for another RM3,000 to say that his business hit some cash flow problems and needed additional money to roll and that he got a contract to supply to schools.
This incident happened 10 years ago and I never saw the cash returned since then despite chasing for 3 years.
Looking back, I got caught up as I saw the business actually running and had some customers but I didn't know behind the scene there were cashflow issues and cost overrun issues. The business was not able to generate enough cashflow to pay the employees, even the head baker eventually left. While RM3,500 isn't a big sum of money, part of the disappointment was being naïve that someone I was close with could just change and not return the money without any guilt.
One significant lesson I've learned is never to lend money to friends and colleagues. If someone asks, consider offering it as a donation without expecting repayment. Often, those seeking financial help may be taking advantage, viewing you as a last resort lender, which is still safer than resorting to loan sharks. Chances are, they've already exhausted options within their own families. While my experience is not unique, I'm sure many can relate to finding themselves in a similar situation.