App designer implemented their app that way.
Nothing wrong, and might be technical reasons why. Even Apple does this: Pages and Numbers is in iCloud, GarageBand has a folder under "On My iXXXX".
I have several GPS apps on my phone, all of them save to On My: guessing making sure cached maps and data are on the device. Firefox is saving to On My as well.
In the case of GarageBand, might not want to be pushing potentially large projects needlessly. Ditto podcast app I'm trying, iCatcher!, caches on On My sideloaded episodes for probably similar reason.