When it comes to choosing a ledger, teams often face a common question: build or buy?

Build: You design, host, and maintain the entire ledger by yourself. This gives you total control over every feature and data flow, but it means dedicating engineers to build, secure and scale the system, and mastering double-entry accounting and compliance along the way.

Buy: You plug into a ready-made ledger platform managed by a specialist provider. They handle feature updates, security, backups and compliance, so your team can focus on building your product. It is faster to launch, but you trade some control and customization for convenience.

In this article, we'll explore how to choose which approach is best for your organization.

What a ledger really is?

A ledger is, at its core, a database for money. It is an essential tool for reliably recording every transaction and balance in your system. Beyond simply storing numbers, it maps the flow of funds throughout your organization, giving you clear visibility into how money moves from one account to another.

Inaccurate records can lead to missing funds, eroded trust, operational bottlenecks, and even regulatory issues. When your ledger is inaccurate, everyone, from your finance team to your customers, suffers.

This mission critical role of a ledger is why choosing the right ledger approach is vital. Whether you build your own ledger or plug into a third-party solution, your decision will determine how reliably you track money, how quickly you catch errors, and how confidently you can scale your operations.

The Build Option

Building your ledger in-house gives you complete control and customization over how you want your ledger to be built. You can tailor its features, workflows, and integrations exactly to what your product needs, without any need for workarounds or compromises.

1. Security and compliance: Building in-house allows teams to embed their own security policies instead of adapting a third-party's architecture.
2. No vendor lock-in: You avoid future price increases and roadmap misalignments that are common with commercial offerings.
3. A bespoke ledger can power unique features or business lines that off-the-shelf systems simply can't handle.

However, building your own ledger also brings significant challenges:

1. Costs a lot of time: Building from scratch means months (or years) of designing architecture, testing, and iteration before you’re production-ready.
2. Requires in-house expertise: To build a ledger the right way, you need deep technical and accounting know-how beyond the fundamentals.
3. Ongoing maintenance burden: Every data migration, security updates, and new feature request falls on your team indefinitely.
4. Risk of inaccuracy: When engineers with limited accounting knowledge design ledgers, they can be error-prone in double-entry logic or rollback handling, leading to data corruption, regulatory penalties, and eroded customer trust.

The Buy Option

Choosing to buy provides a fully-developed, production-grade solution that you can integrate immediately. This allows you to focus your team's resources building your product and reducing time to market.

1. Speed to market: Pre-built APIs and workflows mean you can integrate core financial operations in weeks, not months.
2. Vendor expertise & support: Dedicated support teams, security patches, compliance updates are handled for you, freeing up your team's resources
3. Comprehensive feature set out-of-the-box: Built-in modules for everything you need to build your financial product.
4. Production-grade reliability: Battle-tested infrastructure with high-availability architectures, uptime guarantees, and regulatory certifications (e.g., SOC 2, PCI DSS).

That said, the convenience of a turnkey solution also comes with its own tradeoffs:

1. Upfront, expensive costs: Commercial cores often charge a setup fee plus annual licensing costs which can be quite expensive.
2. Feature mismatch or bloat: Some vendors offer everything (KYC, lending, fraud, invoiving, etc.) in one package, whether you need them or not, leading to more cost.
3. Developer friction: You may need workarounds or custom services to integrate with your product's requirements.
4. Vendor lock-in: Proprietary data models and export formats make it difficult to switch if you need to.

The Hybrid Approach

What if you could blend the control of "build" and the speed of "buy"? You get a pre-built, production-grade Core that you own, self-host, and customize as needed.

Open-source financial Cores like Blnk Finance have made this possible.

1. Ownership & autonomy: You host the code on your infrastructure, tweak logic or data models at will, and avoid vendor lock-in.
2. Plug and play: Core ledger features and advanced workflows come ready-made. No need for designing from scratch.
3. Security & compliance: You can audit every line of code and integrate it into your internal compliance processes.
4. Cost transparency: The open-source Core is 100% free for personal and commercial use. You also avoid hidden licensing fees or price seat surprises.
5. Community-driven innovation: Bug fixes, performance improvements, and new features are driven via open-source contributions and community feedback, rather than a single vendor's roadmap.

That said, this approach also has its own tradeoffs.

1. Customization & maintenance effort: Engineers must deploy, configure, upgrade and secure the code to keep the system up and running.
2. Access to faster support: Community help may lag, and dedicated support contracts adds cost.
3. Custom integrations: Plugins or connectors for other systems (e.g., KYC providers, payment rails) may require some custom work.

Making Your Decision

Choosing between building, buying or adopting a hybrid approach boils down to matching your team's capabilities, budget, and roadmap. Use the following steps to guide your decision making:

1. Assess your team’s expertise. Determine if you have the engineering bandwidth and accounting know-how to build and maintain a ledger in-house.
2. Map your functional requirements. Identify must-have features versus nice-to-haves and project your transaction volume and integration needs.
3. Calculate total cost of ownership. Compare the full costs of building (engineering time, hosting, maintenance) against buying (licensing, transaction fees, support) and the hybrid approach (hosting plus customization effort).
4. Evaluate time-to-market and flexibility. Decide whether you need a rapid launch or the ability to iterate freely on your ledger logic.
5. Consider risk tolerance and compliance. Assess how critical zero-error accounting is and whether you need built-in audit, encryption, and regulatory hooks.
6. Plan your support and maintenance strategy. Choose between vendor SLAs, community support, or dedicating internal resources for ongoing upkeep.

Conclusion

There is no right or wrong choice. Your goal is to choose the best approach for your organization's needs.

Companies like Uber and Stripe built their own ledgers in-house, while banks often use third-party financial cores for their robust features and compliance.

If you're a small to mid-sized company, the choice is simpler: spend a lot of time and resources building your own ledger, or adopt an open-source hybrid approach to grow fast without breaking the bank.

If you'd like to get started with the hybrid approach, Blnk Finance is a great match. Reach out to discuss your business and how we can help.