This 100%. I try to cultivate friendships with people whose mental model of themselves and their friendships with me would require that they treat a loan seriously (even if, in the end, they couldn’t pay it back).

With such a friend, whether to loan money is an easy question to answer: yes, as long as I can afford to.

With anyone else I figure I’m not a bank (or a loan shark), so I shouldn’t get into a bank’s business.