Our Gemara quotes a Mishna in Pe’a (3:6), in which Rabbi Akiva taught that even a very small amount of land is obligated in pe’a (leaving a corner of the field unharvested for the poor) and bikkurim and could be used as the basis for writing a prosbol.
According to the Torah, among other things the Sabbatical year annulled most private loans (see 15:1-3). Recognizing that lenders were reluctant to offer loans as the Sabbatical year approached – which was, itself, forbidden by the Torah (see 15:9-11) – Hillel HaZaken established a method that would allow the lenders to collect the debts that were owed to them, even after the Sabbatical year. His suggestion was to write a document – called a prosbol – that effectively turned the loan over to the courts, which were not constrained by the laws of shemitta, since they do not apply to public debts. Thus, when the Sabbatical year was over, the court would be collecting the debt, rather than the individual. This legal fiction was viewed as a benefit for both the rich – who would now be able to recover their loans – and the poor – who would now be able to borrow money when they needed to.
Rashi explains the need for land as the basis for a prosbol as stemming from the fact that this law only applied to standard loans. In order to be considered a standard loan, land had to be made available as a guarantee that the loan would be repaid.
The source for the term prosbol is Greek, although it is not entirely clear what the word refers to. One suggestion is that it means simply “an announcement delivered to the courts.” Another suggestion is that it means “finalizing the sale.” Other suggestions have been raised as well.