Internal balances

In your application, there are scenarios when your balances interact with your organization accounts or external balances. As a principle, it is crucial for you to have an organized way of tracking these interactions in your ledger.

This is why Blnk creates the General Ledger. The main difference between the general ledger and other ledgers is that it is meant to group balances owned by your organization. We refer to these balances as “Internal balances.”

Let’s dive in ✨

What we’ll cover …

1. What are internal balances?
2. Creating an internal balance
3. Naming conventions
4. Representing external accounts

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1. What are internal balances?

An internal balance is a ledger balance owned by your organization, e.g., revenue, fees, loans, etc. You can use an internal balance to track interactions between your own accounts as an organization and your customers accounts managed by your application.

For instance, you own an online e-commerce app that assigns a wallet to every signed up user. Two things happen:

1. Every time a user pays for something on your app with their wallet, their balance is debited and you earn revenue.
2. Every time a user funds their wallet, a fee is debited from the user’s wallet and paid somewhere (the e-commerce startup or the payment processor).

There are two destinations that have not been defined — revenue and fees. These have to be represented as balances held and managed by the organization.

To do this, you need to create these balances in the General Ledger and provide them as the destination in your transaction record request to complete the transaction workflow.

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2. Creating an internal balance

Blnk makes this simple by automating the creation and identification of balances in the General Ledger. When a transaction is recorded and a balance is referenced using the ”@” prefix, Blnk checks to see if it exists in the General Ledger.

If the specified balance doesn’t exist, it is automatically created, and the transaction is processed accordingly.

Continuing our earlier example, we can represent revenue with @Revenue and fees with @Fees. A transaction request from the user’s wallet when they pay for something on the app would look like this:

{
    "amount": 750000,
    "reference": "ref_1298122819291982",
    "currency": "USD",
    "precision": 100,
    "source": "bal_91283-8102dj1-1209212-129109",
    "destination": "@Revenue"
}

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3. Naming conventions

When choosing names for your internal balances, it’s important to use consistent and descriptive naming schemes. This ensures easy recall and reduces the risk of errors when posting transactions.

Here are some things to note when naming your internal balances:

1. Always use the @ prefix to automatically add it to the General Ledger.
2. Use names that clearly describe the balance’s purpose, e.g., @Revenue, @Fees, @World, etc.
3. Avoid using the same name for internal balances that serve the same function but represent different asset classes. For example, instead of naming two balances @Revenue—one in EUR and the other in USD—name them @RevenueUSD and @RevenueEUR for better clarity and easier reference in your integration.
4. Use camel case (@OnlineRevenue) or underscores (@online_revenue) to separate words for better readability. Avoid including spaces to prevent formatting issues.
5. Keep it short to facilitate easier referencing.

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Need help?

We are very happy to help you make the most of Blnk, regardless of whether it is your first time or you are switching from another tool.

To ask questions or discuss issues, please contact us or join our Discord community.