Normally I make it a habit not to loan money. Just as I try to avoid borrowing money.
However if I did loan someone money I would first determine whether or not if I could afford to lose it first. After all there are no guarantees a lender will get their money back even if they are a financial institution. Lending is a "calculated risk".
The next step is to access that individual's circumstances. In other words ask them: "What is going to happen that will put them in a position to pay me back while allowing them to maintain their living standards." The next question is to ask; "When will you be able to pay me back?"
Sometimes people make stupid loans. They know the borrower doesn't have a job, has bad track record, or they've defaulted on loans to others in the past.
If the loan is sizable/more than $200 you probably should draft a promissory note detailing the amount loaned and payment arrangement including a due date. You'd both sign and date it. Each would have their own copy.
This way if they default then you have a document to present in small claims court. Bear in mind just because you "win" in court does not mean you will automatically get your money. It just means there is a legal record and a judgment in your favor.
The bottom line is if someone has no job or money to pay you back you're not going to get paid back.