Splitwise: A Breakdown

The journey of Splitwise began in 2011, when Ryan Laughlin, Jon Bittner, and Marshall Weir launched it as "SplitTheRent", focused on helping roommates split rent and utilities. As its user base grew, the app expanded to cover a wide range of shared expenses, from group trips to household costs. In 2019, Splitwise underwent a major redesign, updating its logo, homepage, and mobile interface for a cleaner, more user-friendly experience. This helped broaden its appeal and support continued growth. In 2024, it partnered with Tink, an open banking platform. The partnership aimed to add direct bank transfers in supported regions, reducing the need for third-party payment apps.

Splitwise uses Ruby on Rails to power its backend, providing a solid foundation for core features. The infrastructure it uses is a hybrid deployment model consisting of Amazon Web Services (AWS) and Heroku. AWS provides flexible and scalable computing resources, while Heroku enables streamlined deployment and DevOps practices. This architecture supports their API-first approach and ensures scalability and maintainability.

Four types of groups can be created in Splitwise: Trip, Home, Couple, and Other, each offering context-specific features. Members can be added using a name and email address or mobile number. To streamline future interactions, users who share a group are automatically added to each other’s friends lists, making future expense splitting easier.

If members of a group owe each other in a way that forms a circular debt, Splitwise automatically simplifies the transactions by clearing out intermediary balances. This helps reduce unnecessary payments, saving both time and effort. The feature is called “Simplify Debt” and can be disabled in the group settings if preferred.

Users can customize how an expense is split among members when adding it to a group. The expense can be divided in one of the following ways:

• Equally, among all the group members
• Unequally, by entering the amount each person has to pay
• Percentages of the expense each member is accounted for
• Shares (of the total amount) that each person is entitled to
• Adjustments, by recording how much every member has individually added to the total bill and splitting the rest equally

Other notable features include multiple effortless ways to add friends, whether through QR codes, links, mobile numbers, or email addresses. This makes it easy to save friends, colleagues and relatives alike for any future expenses. Once you're set up, you can leave comments on each expense, which is useful for adding context or reminders for any transaction. While Splitwise streamlines group expenses by simplifying overall debts, it also offers the flexibility to settle balances between specific individuals, making it easy to clear all dues between a pair of friends, even if those debts originated within group transactions. For those who love to keep things organized, there's the option to export all the data into a .csv file, making budgeting or record-keeping easy. Timely email reminders help ensure no one forgets to settle up, and balance reminders between friends enable users to send each other notifications of their personal debts. Thoughtful privacy features like app lock, either after inactivity or before being allowed to add expenses, keep your data secure. As an added bonus, Splitwise offers a clean and intuitive web version that complements the mobile experience. Despite its slightly simpler layout, the web platform provides early access to some tested, yet developmental stage, beta features and personal monthly expense trends, making it a valuable companion for anyone looking to stay ahead in managing shared expenses.

Splitwise operates on what is known as a “freemium” model, wherein more basic features are available free of charge, while advanced ones must be paid for.

The Pro version of Splitwise offers a variety of additional features. Most notable amongst these is the ability to record unlimited expenses per day, as opposed to the limit of three that the free version imposes. Charts and graphs are made available for groups and more importantly, individual spending, which provide spending trends and a quick overview of expenses by category.

Receipt scanning and itemization are also supported only in this version. Receipt scanning eliminates the need to manually record expenses, and itemization allows the user to assign different items listed on a receipt to various group members. Additionally, an expense search feature assists the user in verifying and, if required, editing older bills or items.

Another pro feature is currency conversion, which uses the current conversion rate.  A default split setting can also be saved for a group in Pro, ensuring that expenses recorded in the future can be split according to the preset method and weight.

The Pro version also grants the user a completely advertisement-free experience, as well as early access to new features.

Another point to touch upon is the reason why major corporations have not cloned Splitwise and merged it with a transaction platform. The reason can be explained in three parts.

Firstly, the fact that Splitwise was among the first apps in its niche, caused a large portion of the market to adopt it. This user base has remained largely loyal over the years, and most users do not see any compelling reasons to switch.

Next, Splitwise focuses on the issue of social awkwardness. In the event where a consumer is paying for someone, Splitwise automatically enters an expense and sends notifications instead of them having to directly request money from the borrower. This functionality is rare, with its alternatives either being personal expense tracking apps, or payment apps that send a request with a prompt notification.

Lastly, Splitwise has partnered with companies such as PayPal in the US eliminating the possibility of it becoming an online payment app, keeping its focus on being a socially adopted expense splitting app. Splitwise, however, does not integrate with GPay or any other UPI-based payment method that are prevalent in India.

Among Splitwise’s many competitors, Google Pay stands out as the most versatile alternative, particularly within the Indian market. It allows users to make UPI transactions directly, send payment reminders, chat in groups for expense discussions, and even split expenses without the need to create a group. With the added benefit of password protection or biometric authentication, and a simple, unified interface, it feels more native and socially integrated. However, with UPI being a local Indian payment protocol, it lacks international support and isn’t suitable for cross-currency or global expense tracking. It also lacks core expense management features like debt simplification, expense editing, itemised splits or concise history tracking, and doesn’t offer a desktop/web version. While it is more of a payment tool than a full-fledged expense tracker, its ease of use gives it an edge in day-to-day casual usage.

Other competitors offer more targeted features but still come with major limitations. Splid introduces simplified debt tracking, currency conversion and expense export to PDF and Excel. It however lacks a web version, requiring users to add themselves to groups manually, and does not sync friend totals across groups. Settle Up offers a cleaner UI and useful features like default members, currency conversion at the current rate, and .csv exports, along with a web version. It also restricts categories to premium users. Splittr, meanwhile, is the most basic bill-splitting tool that’s useful for a quick split while adding tips, both amount and percentage wise. It lacks sharing, history, reminders or web support, making it far less suitable for any long-term or collaborative expense tracking. A common missing feature across these competitors is syncing member debts across groups, which is a useful feature Splitwise possesses.

Expense tracking apps are most useful when the people involved have budget constraints (like college students or roommates) and want to ensure every rupee gets accounted for. If you often find yourself in group situations where expenses are shared evenly with no single designated payer, or if you're juggling multiple group combinations and want to keep peer-to-peer debts in sync, Splitwise shines. It’s built for precisely that - keeping balances fair and transparent across groups. The “simplify debt” feature is especially useful for groups that split expenses often, as it cuts down on unnecessary back-and-forth over repeated transactions, but for one-time plans or more diverse, non-recurring groups, it might feel like more effort than it’s worth.

On the other hand, if there's typically one person footing the bill and you don’t need complex tracking, Google Pay is arguably the most practical choice. It doubles as a direct payment method, unlike Splitwise which, while offering PayPal integration, doesn’t handle payments on its own.

That said, if you’re comfortable with spreadsheets and know how to use formulas, you can often sidestep the limitations of both. A custom sheet in Google Sheets or Excel can offer all the flexibility you need, without any of the app-imposed restrictions....