Can anyone suggest a good app where you can categorize your photos in different folders.
Yes, I know that, but to upload photos in the selected folders is a bit fiddly.You are aware that when you tap the photo icon there is a + key on the upper left. You can create folders there.
Try "Photo Manger Pro" (PhotoMgrPro) in the Apple store. You can even use WiFi to transfer photos where you want them and has security passwords for folders.