# Warm Card: What It Is, How It Works, Example

![Warm Card: A bank card that is used by businesses to allow their employees to make deposits in their financial accounts.](https://www.investopedia.com/thmb/g-9rxu13XtMAjbc_2_8QiGAyoL8=/1500x0/filters:no_upscale():max_bytes(150000):strip_icc()/warm-card.asp_final-8cb7477262bb436b98e8dabd4fd2db33.jpg)

*— Investopedia / Ryan Oakley*

## What Is a Warm Card?

A warm card is a type of bank card that provides restricted access to a business account. It is given to an employee who needs to have limited access to a company's financial accounts. Typically, these cards allow deposits but not withdrawals. This allows the employees to make transactions while reducing the risk of theft.

### Key Takeaways

*   A warm, or "deposit-only," card is a bank card that is used by businesses to allow their employees to make deposits in their financial accounts.
*   As opposed to debit cards, warm cards typically only allow the employee to make deposits, while prohibiting them from making withdrawals.
*   Warm cards are used by corporations to enable their employees to make necessary transactions, but to reduce or eliminate the risk of theft or fraud.

## Understanding Warm Cards

Warm cards are used by businesses that want to minimize their risk of [fraud](https://www.investopedia.com/terms/f/fraud.asp) or theft. Employees whose job descriptions require them to make bank [deposits](https://www.investopedia.com/terms/d/deposit.asp) can be given warm cards that allow them only the access needed to complete their duties. By blocking withdrawals, warm cards eliminate the risk of theft by employees.

Businesses also have access to other security measures, such as the use of [multi-factor authentication](https://www.investopedia.com/terms/t/twofactor-authentication-2fa.asp) or complex passwords. As the scale of online fraud continues to grow, businesses are increasingly turning to a mixed approach in which they combine these online methods with physical measures such as the use of warm cards.

Warm cards are distinct from [debit cards](https://www.investopedia.com/terms/d/debitcard.asp) in that the latter generally allow for both deposits and withdrawals. Another difference between them is that debit cards are used by both business and individual bank customers, whereas warm cards are specific to business customers. Debit cards also permit transfers between accounts, but warm cards are limited to specified accounts.

> **Important**
>
> As online fraud has increased, businesses have had to combine physical measures such as using warm cards, with other security measures like multi-factor authentication or complicated passwords.

## Example of a Warm Card

To illustrate how warm cards work, say you are the owner of a chain of coffee shops. Altogether, your company has five locations and 15 employees. Each location has a store manager whose responsibilities include depositing the cash received from customers at the end of each week.

As part of your [internal controls](https://www.investopedia.com/terms/i/internalcontrols.asp), you issue warm cards to each of five store managers. Each of these cards is connected to a company bank account set up to hold the cash from customers. When the store managers present their cards, the bank tellers know that they are authorized to deposit cash into the company account. At the same time, the warm cards don't permit [withdrawals](https://www.investopedia.com/terms/w/withdrawal.asp) or transfers to be made, so they effectively insure against the risk of fraud or theft.

Unlike credit cards, the warm cards don't impart any borrowing capacity to the user. Therefore, you don't need to record any [liability](https://www.investopedia.com/terms/l/liability.asp) associated with these cards, and you doesn't need to be concerned with the [creditworthiness](https://www.investopedia.com/terms/c/credit-worthiness.asp) of the employees using them. Similarly, the employees know that using warm cards won't affect their personal [credit scores](https://www.investopedia.com/terms/c/credit_score.asp).

## What's Another Name for a Warm Card?

Warm cards are also sometimes called "deposit-only" cards by banks and the business customers who use them.

## What Are the Main Benefits of a Warm Card?

Warm cards come with two key benefits: fraud protection and convenience. Because warm cards let employees to make deposits into business accounts but restrict access to the ability to spend with them, the employees won’t be able to commit fraud by withdrawing money they shouldn’t or using a business card to make personal purchases. In terms of convenience, with warm cards, a variety of employees can handle deposits and relieve the owner of that task.

## How Can You Get a Warm Card?

Warm cards are relatively easy to obtain from financial institutions that provide them. Usually, you have three options for requesting a warm card: 1) Go to the bank branch and ask for one. It typically takes a few business days for the card to be shipped to you. 2) You also can call your bank to request a warm card. 3) Or most financial institutions offer mobile banking apps. Those offering warm cards should make it easy to access these restricted cards through their app.

## The Bottom Line

A warm, or deposit-only, card is a bank card used by businesses to let employees to make deposits in the business's financial accounts. Unlike debit cards, warm cards typically only allow the employee to make deposits, while prohibiting them from making withdrawals. Warm cards are used by companies to enable their employees to make necessary transactions, while reducing or eliminating the risk of theft or fraud. They also can increase convenience for owners by allowing them to delegate cash deposits to employees without concern about fraud or theft.

> **Article Sources**
>
> 1.  Ramp. "[The Benefits of Using a Warm Card for Your Small Business](https://ramp.com/blog/warm-card)."