About Expense-Sharing Applications

Expense-sharing applications are used to log, track, and monitor the expenses of users with each other or in a group. The most famous example of such an application is Splitwise. 

About Splitwise

eSplitwise is an app available on Android and IOS that helps users track their expenses. Users can split their expenses for trips, movies, taxis, or any other day-to-day expenses between family, roommates, and friends. Users just need to enter the expense in the system, Splitwise simplifies and tracks the overall settlement status. When a user enters the details of the expense, the app gives a choice of type of split the user wants like exact, equal, or percentage. The app keeps the history of all expenses and allows to record a payment. The app also allows users to make a group and track expenses in that group.

• ‘Simplify debts’ is a feature of Splitwise that restructures debt within groups of people. It does not change the total amount that anyone owes, but it makes it easier to pay people back by minimizing the total number of payments. 
• Along with it, Spliwise Pro has paid features like users can scan receipts to record a payment, analyze their expenses with charts/graphs, can make settlement payments through the app

How do Expense-Sharing applications work? 

• Suppose there are 3 flatmates sharing a flat. Now electricity, daily utility expenses, rent, and many other expenses. Consider rent of 12000.
• If any user pays the rent, it should be distributed equally among all users. Hence 12000/3 = 4000 is lent by the rest of the users(flatmates).

Here Splitwise will do the final math and indicate the settlement that the users have to make. We just have to build an expense-tracking application like this.

In this post, we will look into the System Design of Expense Sharing Applications such as Splitiwse. We will deep dive into the LLD of Splitwise, the Happy Flow of Splitwise, and also how to design the backend for Splitwise or such Expense Sharing Applications.