The stabbing was reported at about 11:25 p.m. near the intersection of Franklin and Vallejo streets.
The 39-year-old victim was driving when he saw the suspect walking on the sidewalk. He got out of his car and an argument ensued over the debt, according to police.
The suspect then stabbed the victim in the chest with a folding knife and fled. The victim was taken to San Francisco General Hospital to be treated for his injuries, which were not considered life-threatening, police said.
The suspect, a 42-year-old man whose name has not been released, was found and arrested a short time later, according to police.