It is a myth that knights were all of a single feudal system with uniform obligations in the high or late middle ages. Obligations of the knightly class were diverse and could vary even within a single time period and geographic locale. So this answer is restricted - it should not be seen as typical across all of Europe in the middle ages.

That being said, the origins of the idea of paying to opt out of knightly service are in 12th century England. We see the development of scutage, from the latin scutum for shield. It was a 'shield tax' paid in lieu of service. This was a type of tax which transformed and was adopted in different ways by different monarchs in the middle ages, combining with other tax forms. Knights were not the only class subjected to these forms of taxes, there were levies on nobility for the same reasons.

These fees developed at the same time as the development and use of mercenary armies in the early 12th century and were used to pay for them. These same mercenary armies were filled with knights who could not obtain a fief under the pressures of primogeniture and subdivisions of finite amounts of land: the so-called landless knight.

BTW: your question will have a better chance of being seen and answered if you use more objective language. The expression 'bad old days' is probably the reason you've been down voted. Using objective terms like middle ages or medieval period will give you a better shot at receiving an answer.