In the early middle ages slavery was not an uncommon result of being captured without the means to ransom oneself, however by the 11th century inroads made by Christianity made the external slave trade no longer politically or morally acceptable and extolled the heavenly benefits of freeing prisoners and slaves from their bondage - shortly after the Norman Conquest William lead an expedition into Wales resulting in the freeing of hundred of slaves, then passed a law in 1070 banning the trade of slaves outside of the Kingdom of England. As to the fate of William's prisoners, from 1066 to 1087 history records exactly one prisoner of William's who was executed: Earl Waltheof, who had organized a rebellion in 1075.

In later periods, the captured would be stripped of their armour and weapons, then ransomed to the appropriate authority. The appropriate authority in most cases was not the overlord of the person in question, but rather the families of the prisoners, who naturally had good incentive to ransom their relatives. Likewise for mercenary companies, which generally provided for the distribution of ransoms contractually and couldn't afford to be callous with the lives of their men: being significantly under-strength from imprisonment or desertion meant the loss of a contract. Princes who fielded armies for pay generally did so with the understanding that they would be paying ransom, and like mercenary companies failure to do so would have been politically unwise. Generally speaking, people who found their way onto battlefields in the middle ages were not penniless and friendless, and actual pitched battles were relatively uncommon. In the rare cases of a completely unprofitable prisoner, prisoner trades or setting them free after swearing an oath not to take up arms again was not unheard of.

By the 12th century prisoners in war against non-Christians had recourse to the Royal, Celestial and Military Order of Our Lady of Mercy and the Redemption of Captives and the Order of the Most Holy Trinity and of the Captives, who effected the release of hostages by a combination of payment from alms collected as well as the knightly arms of the orders taking Muslim hostages for trade.

Likewise, for Muslims the freeing of slaves from their bondage was an explicit religious duty from the start: “Alms are for the poor and the needy, and those employed to administer the (funds); for those whose hearts have been (recently) reconciled (to Truth); for those in bondage and in debt; in the cause of Allah; and for the wayfarer: (thus is it) ordained by Allah, and Allah is full of knowledge and wisdom.” — Qur'an, Sura 9 (Al-Tawba), ayat 60

 

Ingram, James trans. The Anglo-Saxon Chronicle. http://avalon.law.yale.edu/medieval/ang11.asp.

Rodriguez, Jarbel. Captives and Their Saviors in the Medieval Crown of Aragon. Washington, US: Catholic University of America Press, 2011.

Saul, Nigel. Chivalry in Medieval England. Cambridge, US: Harvard University Press, 2011.