(1) The sabbatical year cancels a debt, whether written in a document or not written in a document. A debt to a shop is not cancelled, but if it had been converted into the form of a loan, then it is cancelled. Rabbi Judah says: the former debt is always cancelled. A wage-debt to a worker is not cancelled, but if it had been converted into a loan it is cancelled. Rabbi Yossi says: the [payment for] any work that must cease with the seventh year, is cancelled, but if it need not cease with the seventh year, then it is not cancelled.

(2) One who slaughters a cow and divides it up on Rosh Hashanah [at the end of the seventh year]: If the month had been intercalated, [the debt] is remitted. But if it had not been intercalated, it is not remitted. Penalties for rape, for seduction, for defamation, and all other acts of the courts, are not remitted. One who loans and takes a pledge, and one who hands over his debt documents to a court, these debts are not remitted.

(1) Every seventh year you shall practice remission of debts. (2) This shall be the nature of the remission: every creditor shall remit the due that he claims from his fellow; he shall not collect from his fellow or kinsman, for the remission proclaimed is of the Eternal. (3) You may collect from the foreigner; but you must remit whatever is due you from your kinsmen. (4) There shall be no needy among you—since the Eternal your God will bless you in the land that the Eternal your God is giving you as a hereditary portion— (5) if only you heed the Eternal your God and take care to keep all this commandment that I command you this day. (6) For the Eternal your God will bless you as God has promised you: you will extend loans to many nations, but require none yourself; you will dominate many nations, but they will not dominate you.

(7) If, however, there is a needy person among you, one of your kinsmen in any of your settlements in the land that the Eternal your God is giving you, do not harden your heart and shut your hand against your needy kinsman. (8) Rather, you must open your hand and lend him sufficient for whatever he needs. (9) Beware lest you harbor the evil thought, “The seventh year, the year of remission, is approaching,” so that you are mean to your needy kinsman and give him nothing. He will cry out to the Eternal against you, and you will incur guilt. (10) Give to him readily and have no regrets when you do so, for in return the Eternal your God will bless you in all your efforts and in all your undertakings. (11) For there will never cease to be needy ones in your land, which is why I command you: open your hand to the poor and needy kinsman in your land.

(3) A 'prozbul' is not cancelled. This was one of the things enacted by Hillel the elder. For when he observed people refraining from lending to one another, and thus transgressing what is written in the Torah, “Beware, lest you harbor the evil thought, [‘The seventh year, the year of remission, is approaching,’ so that you are mean to your needy kinsman and give him nothing.” So Hillel enacted the prozbul.

(4) This is the formula of the prozbul: “I turn over to you, so-and-so, judges of such and such a place, that any debt that I may have outstanding, I shall collect it whenever I desire.” And the judges sign below, or the witnesses.

“The question was raised: When Hillel instituted the prozbul, did he institute it for his own generation only or for future generations also? What is the practical bearing of this question?  — In case we wish to abolish it. If you say that Hillel instituted the prozbul only for his own generation, then we may abolish it, but if for future generations also, then one Rabbinical Court cannot annul the decisions of another (unless it surpasses it in wisdom and in number).

Come and hear: Samuel said: “This prosbul is an assumption on the part of the judges; if I am ever in a position, I will abolish it.” He abolish it?! How so, seeing that one Rabbinical Court cannot annul the decision of another unless it is superior to it in wisdom and numbers? — What he meant was: If ever I am in a stronger position than Hillel, I will abolish it. 

R. Nahman, however, said: “I would confirm it.” Confirm it? Is it not already firmly established? — What he meant was: I will add a rule that even if it [the prosbul] is not actually written it shall be regarded as written.”

Hillel instituted the prozbul because of tikkun olam.