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What is RFID? Basics of Radio-frequency identification

  • Administrator
  • May 30, 2023
  • RFID
What is RFID and how does it work

Automatic Identification & Data Collection technology has become an essential part of most businesses. Starting from barcodes, these systems have brought significant improvements to business operations. One of the most popular systems in this niche is RFID. This technology is responsible for optimizing many industries and improving their day-to-day productivity. However, they bring much more benefits with them than that.

So, let’s have an in-depth discussion about radio frequency identification technology.

What is RFID?

Radio Frequency Identification, commonly known as RFID, is a type of AIDC (Automatic Identification and Data Collection) technology that communicates using radio signals. These systems contain three major components, namely – Tag, Antenna, and Reader.

How Does RFID Work?

As stated above, these systems communicate by using radio signals. The antenna connected to the reader, broadcasts radio signals and creates a field of influence around it, known as the interrogation zone. We divide this zone into two categories, Near-Field and Far-Field, based on the location and type of tag, they can communicate in either both or one of these zones.

Inside the Near-Field, the tag uses a process called inductive coupling, which works within 10 cm of the antenna. The radio signals from the antenna induce an electric charge within the tag, the tag then uses a small antenna inside it to send back a signal with the data inside it. In the case of Far-Field, the tag communicates with the reader using a method called radiative coupling. The signals from the reader come in contact with the tag. The tag then uses backscattering to reflect the signal towards the antenna with its information in it.

Once the signal starts traveling from the tag, it is received by the antenna on the reader and sent into the reader. The RFID reader then converts these signals into a readable format and sends them to the system.

Types of Radio Frequency Identification Technologies

There are several criteria you can use to classify RFID technologies, like on the basis of internal power, application, communication range, etc. So, let’s have a brief chat about the different types of radio frequency identification systems.

Internal Power

As we’ve discussed previously that these systems communicate using radio waves, meaning that they need the energy to broadcast radio waves. There are two ways to get this energy, either with a power supply or using the radio signal from the reader to power up the tag. Based on this, there are two types of such systems.

1) Active Tags

These tags work by broadcasting their signals to communicate with the reader. These have an internal power source/battery, that provides it with enough energy to produce radio waves. Due to this, their signals have more energy in them and have a far better-read range. Then can work up to 100 meters.

2) Passive Tags

These tags lack an internal power source, so they rely on backscattering or inductive coupling to transmit information to the reader. Although, compared to active systems, their range is very limited. But some UHF tags can transmit information up to 20-30 meters.

Readable Range

The communication range of these systems can depend on a variety of factors like frequency, type of antenna, type of tag, etc. Antennas with higher operational frequency have more powerful signals, meaning, that they can travel for longer distances. In addition, there are a variety of different types of antennae available in the market. From short range to long range, low power to high power, different types of polarization, etc. These all can affect the communication range of the system.


Due to the variety of industries that employ this technology, there are several different designs available all suitable for different applications. For example, hard tags consist of a protective outer shell, designed to withstand high temperatures and physical damage. On the other hand, Mount On-Metal tags have a layer that separates the inlay from the surface, preventing signal distortions.

Common Applications of RFID

These systems are a type of AIDC technology, their primary purpose is identification & data communication. So, let’s discuss some basic applications of this technology.

1) Asset Identification & Tracking

An effective RFID system can easily identify assets based on the information inside the tag that is mounted on them. The reader has multiple antennae connected to it, and it is connected to the database. This allows these systems to keep track of the movement of assets throughout the supply chain.

2) Access Control

Another great application of this technology is in security. Radio Identification can provide a secure means of providing access to facilities like parking lots, and offices. In corporate buildings, companies can incorporate an NFC reader to the gate locks, and provide employees with RFID smart cards to allow them access to the premises. The same can be done to grant different levels of access to different employees, this works great for places that contain sensitive documents and files.

3) Inventory Management

With the ability to identify assets without a line of sight, and automatic database updating, you can use this technology to optimize inventory management. Users can have real-time insight into any inventory changes, i.e., the movement of items from and to the inventory. This not provides 2 primary benefits, namely – Accuracy, Real-Time Information, and Reallocation of Resources.

4) Contactless Payment

In the last couple of years, we’ve seen banks employ the contactless payment feature in their debit/credit cards. This method of transaction uses radio identification technology. Look at your card, if there is a Wi-Fi symbol on it, it means that it has an inlay inside it. This inlay allows the card to communicate your account information to an NFC reader in the card machine.

Benefits of Using RFID Technology

Due to their varied characteristics, there are a lot of benefits that users can enjoy with the integration of these systems.

1) Automation

These systems do not need an operator to perform, unlike other AIDC systems. Any tag that is within the interrogation range of a reader will automatically communicate and update the database with information. This allows companies to cut the cost of performing unproductive tasks like inventory management, and asset tracking, and make them more accurate.

2) Reduction in Inventory Shrinkage

With its ability to track the movement of assets & provide information in real time. This system provides a security measure to your premises. Whenever an item is about to leave the facility without prior authorization, the system can send a security alert. According to statistics, an RFID system can reduce Inventory Shrinkage by 75% and Theft by 85%.

3) Cost Reduction

In order to operate a business, you need to invest money into it, this could be for buying raw materials, or cost of labor, etc. Certain essential tasks like inventory management, access control operator, etc are unproductive and are essentially costs. With the implementation of radio identification, businesses can automate these tasks and reallocate the human resources invested in them to a more productive operation. In addition, they also reduce unnecessary costs by providing better accuracy and tracking capabilities.

4) Real-Time Oversight

With continuous monitoring and communication with the database, these systems can provide users with all real-time information about the operation of their facility. And if you integrate it with IoT, then you can have a real-time overview of the entire supply chain, and the movement of each item.

5) Improved Visibility

By providing accurate and detailed information regarding the movement of items, raw materials, and assets, users attain improved visibility into the operations of a business. In addition, these systems can also provide better visibility into the movement of employees and other resources.

6) Fast Data Collection

Unlike other AIDC systems like barcodes, RFID provides far better speed of operation. A reader can scan up to a thousand tags in a second, as opposed to 2 to 3 seconds for a single barcode.

Challenges Faced by RFID Technology

After discussing the varied applications and a series of benefits that are offered by radio frequency identification technology, it may seem like a panacea for all identification & tracking related problems. However, they do have their downsides, that prevent all businesses from using them.

1) Difficulty in Implementation

The biggest issue with this technology is the installation and implementation. These systems are complex and need a professional to install them in a facility.

2) Integration Cost

The initial cost of integration like procurement of readers and tags, hiring professionals to install the system, etc can increase the cost of operations. In small businesses, these costs can be significant and may take a long time to recover, making it difficult to afford.

3) Vulnerability to Signal Distortions

Although radio identification technology offers greater operation range, faster speeds, and does not require a line of sight. But that doesn’t mean that it doesn’t have its limitations. These systems are particularly vulnerable to distortions in signals from metallic surfaces, due to eddy currents and signal reflection.

4) Initial Training

As we mentioned above, RFID is a bit more complex than other types of AIDC systems. In order to successfully implement these systems, businesses will need to train their employees. This means that in the beginning the system will have low efficiency and may even induce some cost into the operations of the business.


Radio Frequency Identification is a revolutionary advancement in the field of asset identification & tracking, supply chain management, etc. These systems provide a greater and more accurate insight into a business’s day-to-day operations. However, it does have its disadvantages like the increased costs, training requirements, etc.

In conclusion, it is an investment that a businessman should make after carefully considering its advantages & disadvantages.

Frequently Asked Questions:

Q1. What are the applications of active RFID?

Ans - Almost all types of tags are used for the same purposes, however, their use changes slightly. For active RFID, the primary application is in providing real-time tracking capability, and asset identification in large areas like warehouses, etc.

Q2. What is an RFID scanner?

Ans - It is a primary component of a radio frequency identification system. A scanner is responsible for broadcasting an interrogation signal and receiving signals from the tags. They then convert the signal into a readable format and transmit it to the database/computer.

Q3. Can a smartphone read RFID?

Ans - Yes, almost all modern smartphones come with an internal NFC sensor that is capable of communicating with RFID tags.

Q4. Does RFID have power?

Ans - Yes and no, there are two types of RFID tags, namely – active & passive. Active tags have an internal power supply that it uses to broadcast a signal of its own. Passive tags rely on the signal from the reader to communicate.

Disclaimer: The information presented here is for general information purposes only and true to best of our understanding. Users are requested to use any information as per their own understanding and knowledge. Before using any of the information, please refer to our Privacy Policy and Terms and Conditions.

  • Created on Apr 23, 2022
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