What are the reasons why the banks might not be willing to lend to certain borrowers?

The banks might not be willing to lend certain borrowers due to the following reasons:
 Banks have their own rules and regulation which require proper documents and collateral as security against loans. Upon failure to meet these requirements, loans cannot be granted. Small farmer requiring crop loan usually don’t have adequate documents. Repayment of the loan is dependent on crop production which is highly volatile and depends on external factors like monsoons etc.
• The bank will not lend money to borrowers who have not repaid previous loans.
• The banks go through the research and development of a business and might not be willing to lend those entrepreneurs who are going to invest in the business with high risks.
• One of the principle objectives of a bank is to earn more profits after meeting a number of expenses. For this the bank needs to ensure that the money they lend is returned timely and doesn’t become a debt.

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