MAX7219 Alternative for 4 Digit 7-Segment display.

the MAX7219 chip to be very popular, but it is somewhat expensive

Popular and expensive usually means that there is no alternative. I haven't seen a cheaper one, more expensive yes nut not cheaper.

You can drive them like a multiplexed display but then the arduino would have to keep the display alive with software.

You would be better off using shift registers and drive the segments continuously instead of multiplexing them.