The explanation is as follows.
In H2O, both lone pairs are on the oxygen. There would be only one binding site between H2O and the central metal. So it is a monodentate.
Also, water is too small to form two bonds to a TM center, especially since both lone pairs are on the same O atom. Polydentate ligans form their multiple coordination bods through lone pairs on different atoms in their structure.
Hope it answers your question.
All the best!