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What is Radio Frequency Identification (RFID)?

July 10, 2021
With the rapid decrease in the cost of RFID tags, the use of RFID systems has become widespread and the RFID market is estimated to be worth $13.4 billion by 2022. As of today, many applications take advantage of RFID systems such as credit cards, collecting tolls, granting access to vehicles in gated communities, tracking library items, animal tracking, tracking goods moving through the supply chain, and many more. 

But if you’re asking yourself ‘What is RFID technology?’ or ‘What is an RFID system?’, you’re in the right place. This article will delve into what exactly RFID is, how it works, how it can be used, plus we’ve explained all of the technical terms you need to know to understand RFID technology.

What is Radio Frequency Identification (RFID)?

In a nutshell, radio frequency identification (RFID) is a fast-developing technology, providing wireless identification and tracking capability by using radio waves to identify and track tags. 

In theory, it works similarly to barcodes, however, there is no direct scanning needed for RFID tags, plus there is no need for line-of-sight to a reader - opening up the possibilities of how it can be used. Currently, radio frequency identification (RFID) technology is used in numerous sectors like supply chain, transportation, agriculture, manufacturing, and could have a great impact on many more. 

For example, imagine a large manufacturing plant where multiple tools are used at one time. Using RFID, project managers can locate any tool on the site quickly and easily, ensuring effective tool management. Read on to learn more about the different ways RFID technology can be used.

How Does RFID Work?

RFID systems mainly consist of two components - readers and tags:

  1. An RFID reader is a device composed of one or more antennas transmitting radio waves and receiving signals from the RFID tag. 
  2. RFID tags transmit their identity and additional information to nearby readers using radio waves.
Reader and Tag

The RFID tracking process is pretty straightforward, irrespective of how you deploy your RFID system. Generally, the RFID tracking process consists of the following four steps.

  1. The RFID tag stores the data.
  2. The antenna then recognises the nearby RFID tag's signal.
  3. The RFID reader, connected wirelessly to the antenna, receives the data stored on the RFID tag.
  4. The reader then sends the data to a tracking database which stores and evaluates it.

In the manufacturing plant example used above, the RFID tag would be located on the tool. The RFID reader would receive the tag’s signal. And then, it would receive data on where the tool is located. The reader would send this location information to the database to be read by the project manager who could then locate the tool.

What is an RFID Reader?

An RFID reader (also known as an interrogator) is a device used to gather information from an RFID tag in order to track individual objects. The reader comprises a radio transmitter and receiver. Upon powering, the reader continuously transmits radio frequency signals. When there is an RFID tag within the reader's range, it energises the tag and gathers information. The reader uses this information to identify the object. Readers are generally categorised as either fixed or mobile.

Types of RFID Readers

Fixed Readers: These readers are mounted in particular locations and are mainly used for tracking items as they move from one place to another. Fixed readers provide comfort and consistency by automatically tracking tag movements without the need for human involvement, like at a loading dock. They’re commonly used for inventory or asset management.

Mobile Readers: These readers are mainly hand-held and can be used for scanning individual items. These readers offer a lot of flexibility and are widely used in the retail sector. For example, retail staff can count inventory in real-time using handheld mobile RFID readers.

What is an RFID tag?

RFID tags are a vital component of any traceability system. These tags are small devices containing a chip and an antenna that use radio waves to receive, store and send data to nearby readers. Simply put, RFID tags are labels that can store various data such as serial numbers, short descriptions, or even pages of information.

Types of RFID Tags

Generally, there are three main classifications of RFID tags. These are:

  • Active tags
  • Passive tags
  • Semi-passive (or battery-assisted) tags

Active Tags: Active tags consist of a transmitter and a power source, mainly a battery. They actively send a continuous signal. These tags are usually equipped with sensors that can measure and transmit temperature, light, humidity, and vibration data for the attached objects. In addition, these tags have the widest reading range that can extend up to 100m. As a result, active tags are usually larger and more expensive than passive tags. They are often used to track significantly large assets such as cargo containers. 

Active tags are of two types:

  • Transponders - They only wake up and send data upon receiving a radio signal from the reader.
  • Beacons - They transmit signals at set intervals. 

Passive Tags: Passive tags remain asleep until they receive a radio signal from the reader. The tag then uses this radio signal from the reader to turn on and reflect back the energy to the reader. Thus, the reading range is comparatively shorter than the active tags, typically less than 10m. In addition, since these tags do not need a transmitter or power source and need only an antenna and a tag chip, they are smaller, cheaper, more flexible and easier to manufacture than the active tags. The most common application of passive tags is the item-level tracking of pharmaceuticals and consumer goods.

Semi-passive (or battery-assisted) RFID tags: There is the emergence of a third type of RFID tag, a hybrid type known as semi-passive (or battery-assisted) RFID tags. These tags consist of a power source, usually a battery, in a passive tag configuration. What this means is the battery turns on the chip and can reflect back the energy to the reader, but they do not have a transmitter. As a result, their reading range is higher than the passive tags. However, they are more expensive and have a limited life when compared with passive tags. These tags are suitable for applications where extra features like environment monitoring are required and tagged items are within the range of the reader.

Common Operating Frequencies of RFID Systems

The following table represents the most common operating frequencies that an RFID system can use:

Frequency Reading Range Data speed Common uses
Low Frequency (30—300kHz) 1-10 cm Low Animal tracking, automobile inventory
High Frequency (3-30MHz) 10 cm—1 m Low to moderate Contactless payment, shelf inventories
Ultra-high Frequency (300 MHz -3Ghz ) Up to 12 m Moderate Supply chain management, defence applications

RFID Applications

RFID applications

RFID offers countless possibilities for present and future use by offering a cost-effective, efficient and reliable method of collecting and storing data. Below are just a few of the infinite applications of RFID technology:

  • Inventory Management: Businesses can gain instant insight into their inventory. It reduces the need for human input, providing highly accurate and reliable inventory records.

  • Asset Tracking: Allows businesses to track and monitor assets and equipment down to item level. Automating asset tracking in this way prevents issues with human error.

  • Warehouse Management: Businesses can instantly identify products in their warehouse. It can also help automate item receipt and delivery records.

  • Supply Chain Management: Supply chain managers can access real-time information about the movement of goods, ensuring safe passage from manufacturer to consumer.

  • Healthcare: Helps healthcare professionals track newborns and vulnerable patients. Plus it can help ensure the right patient receives the right medication at the right time.

  • Animal Traceability: RFID tags can help track animal movements, particularly beneficial for finding lost pets and/or for wildlife programmes.

  • Counterfeit prevention: Helps to prevent the consumption of counterfeit goods. Tiny tags - like labels - can be added to products to distinguish real from fake.
Counterfeit prevention
  • Access Control: RFID access control tags enable security by restricting access to only pre-approved persons.

  • Retail Sector: RFID systems help reduce human errors in stock-taking, reduce the number of products stolen or lost and reduce time/cost spent manually counting inventory.

  • Library Systems: Libraries can track inventory, storing product information, and providing security from theft, plus checking books in and out can be performed quickly and efficiently.

  • Kiosks: Many kiosks, such as DVD rental kiosks, use RFID technology to manage resources or communicate with users.

  • Toll Road Payments: Many highway toll systems collect tolls from passing cars using RFID technology. The toll is deducted automatically from the prepaid card when a vehicle passes through.

Are There Any Issues With RFID?

There are two main issues to consider with RFID. These are:

  • Reader Collision: This occurs when a signal from one RFID reader interferes with the signal of another reader. This can be prevented with the help of anti-collision protocol by making RFID tags take turns transmitting to their corresponding reader.

  • Tag Collision: When too many tags transmit data simultaneously, it confuses the RFID reader, thus causing tag collision. This issue can be prevented by selecting a reader that collects tag information one at a time.

Key RFID terms explained

Here we’ve listed the most commonly used terms used in relation to RFID technology. 

Active tag

An active tag has its own power source, enabling it to transmit a signal.


Provides a link between a reader and a tag enabling them to send and receive data.


A method of preventing interference of radio waves from one device to another device.

Battery-assisted tag

Semi-active RFID tags operating like passive tags but having batteries, like active tags. Consider it a hybrid tag.


A type of active tag that transmits signals at set intervals.


A component of an RFID tag that stores data.


A device that connects several RFID readers and gathers data from them.


The method of linking a reader to a tag.


A unique identification number encoded within an RFID tag.

Fixed reader

A reader securely fastened or installed at a specific location, such as affixed to a wall.


Another name for an RFID reader or scanner.

Interrogation zone

The area in which an interrogator’s signal is strong enough to attract a passive tag and obtain its information.

Passive tag

Tags that do not require an onboard battery; instead receiving power from the reader. This process is known as energy harvesting.


The process of collecting data from an RFID chip.

Read accuracy

The percentage of the number of tags that are read successfully.

Read range

The maximum distance that a tag remains readable from a reader.


The part of a reader that receives the information from the tag.


It stands for Radio Frequency Identification, which is a type of identification using radio waves.

RFID tags

These tags are small devices containing a chip and an antenna and use radio waves to receive, store, and send data to nearby readers.


Another term for a tag. A transponder consists of two main parts, a chip and an antenna. 

What is the future of RFID technology?

Many industries have adopted RFID technology in recent years. It has truly made real-time locating systems much easier, cost-effective, and reliable. The next innovation for RFID technology will be to provide in-built visual feedback, using low-cost, low-power displays. 

Some examples

  • Authentication labels on medication. Using ‘tap to authenticate’ technology, consumers tap their phones and, if authenticated, the label will light up or change colour, showing them that the medication is safe to consume.
  • Enhanced visual feedback when a transaction is made via contactless payment. The screen could show a smiley face if the transaction has gone through, enhancing the customer experience when transacting.
  • In supply chain monitoring, a display label could automatically update using a progress bar to show all necessary quality processes have been passed.

These are just a few of the RFID display innovations to expect in the near future. Some of which we are working on right now with clients. But of course, with the flexibility RFID technology offers, there are many more possibilities.

We Produce Ultra-Low-Power Displays Ideal For RFID Systems

At Ynvisible, we design and manufacture ultra-low-power displays using innovative electrochromic technology. Using roll-to-roll production methods, we can produce display technology at high volumes and low cost. Not only that, our displays have endless design freedom, so you can create exactly what you need. Discover our segment display kit today to get started.

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