The term “Radio Frequency Identification” (RFID) refers to the process of identification with the aid of electromagnetic waves. RFID enables the automatic identification and localisation of objects and animals, thereby making the collection and storage of data substantially easier.
An RFID system comprises a transponder, which is located on or in the object and/or animal, and a reading device to read the transponder identifier.
The reading device contains software which controls the actual reading process, and RFID middleware with interfaces to other IT systems and databases.
Generally, the reading device produces a high-frequency electromagnetic field of small range, preferably with induction coils. Not only does this transfer data, it also supplies the transponders with energy. Active transponders with their own power supply are used only where it is necessary to achieve large range, and the costs of the transponders are not so critical. [...]
There are generally three types of RFID tags: active RFID tags, which contain a battery and can transmit signals autonomously, passive RFID tags, which have no battery and require an external source to provoke signal transmission, and battery assisted passive (BAP) which require an external source to wake up but have significant higher forward link capability providing great read range.
RFID transponders can be as small as a grain of rice, and implanted, for example in pets. The benefits of this technology are borne out in the combination of the small size of the transponder, inconspicuous reading options and a low price for the transponders (sometimes measured in cents). This new technology is increasingly replacing the barcode, still very prevalent today.
RFID has many applications, for example, it is used in enterprise supply chain management to improve the efficiency of inventory tracking and management.
Quoted from WIKIPEDIA®