This week’s parshah, Re’eh, speaks of the mitzvah of granting loans and shemittas kesfim. As the shemittah year 5775 comes to a close, we would like to explain the concept of pruzbul and encourage all readers to access a pruzbul form and fill it out before Rosh Hashanah.
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Mr. Weiss contacted Rabbi Dayan at the Business Halacha Institute. “I read with interest last week’s Business Halacha article, which addressed shemittas kesafim,” he said. “I understood that, at the end of shemittah 5775, loans past due are cancelled.”
“That is correct,” replied Rabbi Dayan. “According to most authorities this is true also outside of Israel, even nowadays.”
“My question is as follows,” said Mr. Weiss. “I have a number of outstanding loans. An acquaintance also just asked me for a week-long loan of $5,000 until he gets his paycheck. I’m afraid to lend it to him, though. What happens if he is delayed in repaying until after Rosh Hashanah? Then the loan will be cancelled, and I’ll lose my money!”
“You are in company with many other people,” replied Rabbi Dayan, “although I’m hesitant to say in good company.”
“What do you mean by that?” asked Mr. Weiss.
“The Torah explicitly admonishes us not to refrain from lending out of concern for shemittah,” said Rabbi Dayan. “It states: Beware lest there be a lawless thought in your heart, saying, ‘The seventh year approaches, the remission year,’ and you will look malevolently upon your destitute brother and refuse to give him.” (Devarim 15:9)
“Over two thousand years ago,” continued Rabbi Dayan, “toward the end of the Second Temple, Hillel noticed that people were refusing to lend others out of concern that the loan would be remitted. In doing so they were violating this admonition. He therefore instituted the writing of a pruzbul to allow collecting the loan after shemittah.”
“What is a pruzbul?” asked Mr. Weiss. “How does it work? What do I have to do?”
“If you have a few minutes, I’m happy to explain to you,” replied Rabbi Dayan.
“Certainly,” said Mr. Weiss. “Go ahead; I’m all ears.”
“As you mentioned, the mitzvah of shemittas kesafim restricts a creditor from collecting his loans after shemittah,” explained Rabbi Dayan. “The Torah states [Devarim 15:2], ‘Every creditor shall remit his authority over what he has lent his fellow.’ However, if the creditor transferred to beis din‘s authority the loan and its accompanying documents to collect in his stead, the shemittah year does not remit the loan.”
“I’m not about to give over all my documents to beis din,” said Mr. Weiss.
“In order to encourage people to lend and not worry about the loan being cancelled, Hillel expanded this principle,” continued Rabbi Dayan. “He instituted drafting a document that all loans are hereby transferred to beis din, allowing the creditor himself to collect without actually handing over the loan documents. This institution is called pruzbul.” (C.M. 67:11,18-21; SM”A 67:22,36)
“I don’t understand, though,” objected Mr. Weiss. “If the Torah states that the loan should be remitted, how can Hillel institute that the creditor can collect, against Torah law?”
“The Gemara [Gittin 36a-b] raises this question and provides two explanations,” replied Rabbi Dayan. “First, the institution was based on the opinion that nowadays the obligation of shemittah is rabbinic, so that the sages have the ability to institute as they wish.”
“Second, in monetary matters the sages have broad authority, on the basis of hefker beis din hefker – a beis din has the right to confiscate property,” continued Rabbi Dayan. “Thus, even according to the opinion that shemittah remains biblical, the sages can still institute that the creditor can collect through the means of pruzbul.”