When the SHEMITA year 5775 concludes, SHEMITAT KESAFIM takes effect, and all outstanding loans are cancelled. The Shulchan Aruch in Choshen Mishpat 67 rules that SHEMITAT KESAFIM (release of loans) applies also outside the Land of Israel.

Thus, the Shemita year cancels all financial debts. If someone owes you money, and he comes to repay it to you after the Shemita year, you are supposed to say that the debt is canceled. If the borrower still would like to return the money, you are permitted to accept it, and this is considered a meritorious act on the part of the borrower. This is stated by the Rambam in Hilchos Shemita V'Yovel 9:28, "One who pays back his debt during the Shemita year pleases the Rabbis."

Loans are cancelled on the last day of the Shemita year (Devarim 15). Any loan outstanding before the last day of Shemita can be collected up to this date only.
During his time in the Second Temple period, Hillel the Elder saw that this cancellation of debts at the end of the Shemita year caused people to refuse to lend to the poor. Therefore, he established the PRUZBUL – an I.O.U. that is assigned to the Bet Din that allows for collection of the debt after the Shemita year.

The PRUZBUL is a mechanism by which the lender gives over his ownership of the debt to the Bet Din and authorizes them to act on his behalf to collect the debt or to appoint him to collect the debt. The word PRUZBUL is a Greek word meaning "BEFORE THE COURT" placing debts in the hands of the Bet Din so that the Shemita year would not cancel them. Hillel used the Greek term because Greek was the international language of his day like English is today.

How could Hillel establish the PRUZBUL thereby canceling a Torah prohibition against demanding payments of loans at the end of the Shemita year? The answer to this question is based on 3 principles:

1. Hillel saw that the Jewish People were refusing to make loans to the poor thereby transgressing a Torah Mitzvah, "When you lend money to My people, to the poor among you…" (Shemot 22:24). The entire world depends on doing acts of loving kindness as Tehillim 89:3 says, "The world is built on loving kindness." The Mitzvah of Shemita already in Hillel's time was only a Rabbinic Mitzvah. This is because the majority of the Jewish People did not live in the Land of Israel during the entire Second Temple Period. For this reason Moshiach did not come during the Second Temple Period.

2. Rambam and most other Rishonim rule that Shemita is only a Torah Mitzvah when the majority of the Jewish People live in Israel. We are close to that figure, but we are not there yet. Thus, when the situation is created in which a Torah Mitzvah (lending to the poor) is liable to be pushed aside by a Rabbinic Mitzvah (Shemita today), the Torah Mitzvah takes precedence.

  3. The Torah authorizes the Bet Din a mechanism for regulating when and    
where the debt is to be repaid. Thus Rambam rules in Hilchot Shemita V'Yovel 9:15, ''If one gives over his I.O.U contract to the Bet Din  and says to them, 'You collect my debt.' , the debt is not cancelled" [at the end of the Shemita year, and the lender can collect his debt at any time]. Therefore, the Torah states, "If you have a claim against your BROTHER, you must relinquish it at the end of the Shemita year."(Devarim 15:3). Cancellation of the debt applies to your BROTHER, but not to the Bet Din, which is a public institution.

Thus, the Halachic principle that the Bet Din can collect debts even at the end of the Shemita year through the PRUZBUL  is hinted at and alluded to  in the Torah itself.