With the continued development of financial markets, borrowing and loans have become common economic activities in modern societies. However, in order to maintain financial stability and protect against risks, many countries and regions have adopted corresponding legislation, one of which is to limit the balance of loans to the same borrower to a certain amount. This paper will analyse the need for and the impact of this limitation from multiple perspectives。

Should the balance of the loan not exceed that of the same borrower

First, limiting the loan balance of the same borrower helps to control financial risk. When the loan balance of a particular borrower is too high, the risk of repayment or the economic hardship of the borrower poses a significant risk to financial institutions. If there are no restrictions, the borrower ' s arrears may continue to accumulate, leaving the financial institution unable to recover the corresponding principal and interest on the loans. Therefore, limiting the loan balance of the same borrower is an effective way of reducing financial system risk。

Second, it also protects the borrower ' s own interests. Borrowers face greater repayment pressure and financial burdens when their loan balances exceed their affordable levels. This not only affects their quality of life, but may also lead to a failure to pay their debts on time, thus affecting their personal credit records and future lending capacity. By limiting the balance of the loan of the same borrower, the borrower could be prevented from falling into a debt-servicing situation and the financial health of the borrower could be safeguarded。

On the other hand, there is some controversy about limiting the balance of the loan of the same borrower. Some argued that such restrictions could hinder economic development and innovation. If a borrower wishes to borrow funds to support a start-up or scale-up, but is constrained by the balance of the loan, it may not be able to access sufficient financial support to miss development opportunities. It is therefore important to balance the advantages and disadvantages in the design and implementation of such restrictions to ensure that they protect financial stability while promoting economic development。

In general, limiting the loan balance of the same borrower plays an important role in maintaining financial stability and protecting against risks. It helps to control financial risks, protects the interests of borrowers and, to some extent, balances economic development with constraints. However, policies should be tailored to different economic circumstances and market demand in order to achieve the legitimacy and effectiveness of the system。