Biblically, the year of Shemittah cancels debts. Hillel Hazakein observed that people refrained from lending in advance of the Shemittah year, thus violating an explicit prohibition of the Torah (Devarim 15:9). To prevent widespread violation of this prohibition, Hillel formulated a pruzbul so that loans do not become canceled during Shemittah. The pruzbul transfers the loan to beit din for collection and beit din then empowers the creditor to collect the money as their agent. Since loans are not canceled, people will not refrain from loaning money in advance of Shemittah.