It seems exploitative of women especially though, how was it allowed to happen?

Surrogacy primarily benefits women, not men:

1. It allows women to have their 'own' children without becoming pregnant. This benefits women who unwilling or unable to become pregnant. In a sense, this allows women to emulate being men, who obviously have no choice but to have someone else carry their children.
2. In countries where surrogates are allowed to be compensated financially, it allows the surrogates to rent out their wombs, much like prostitution thus benefiting financial.

Note that women generally support prostitution becomes it allows them to directly sell their sexuality (which many women consider their primary asset). Also, a characteristic modern women, especially in Western societies, is their rejection of their biological roles as the ones to carry and bear children as evidenced by strong support of contraception and of abortion, which is perplexing to me as this is one of God's great gifts to women.