What Is RFID Technology?

RFID is a technology commonly used for a variety of applications and in different industries. Many people have either heard of or experienced RFID technology without really thinking about it. One of the most prevalent applications of RFID is its use in contactless payments. These cards use a subset of RFID technology known as NFC. Below is a discussion on what RFID and NFC are, the benefits of each, and how they are used in payment processing.

The RFID acronym stands for the aptly named Radio Frequency Identification. This is because the technology utilizes radio waves to detect unique identifiers. There are typically three main components to an RFID-based system: a reader, an antenna, and the individual identifiers, sometimes known as RFID tags. The identifiers are usually small electronics, such as microchips, that store information on them. The reader, in conjunction with the antenna, can detect the information on these tags from a distance. Depending on the type of system, RFID identifiers can either power themselves using a battery or receive power from the reader.

RFID technology has many familiar applications:

• Inventory moving through a warehouse
• Library book check-outs and check-ins
• Pet microchips that store information about the owner in case the pet gets lost without a collar

In addition to tracking items in real time, RFID is also often used by businesses to give and revoke access to systems, hardware, and buildings using keycards. Because of the unique identifiers on an RFID tag, software can be programmed to detect the information on a card to determine who is trying to access it. Then, the system can decide whether they should have access based on the permissions tied to their account.

Another common application for RFID technology is in the payment sphere. Billfold, for example, promotes security by not writing any personal or financial data to the RFID tag and allowing consumers to apply a PIN protection to verify transactions. Event attendees can be confident in their individual purchases as the transactions via RFID with Billfold are end-to-end encrypted. As event operators you can collect meaningful consumer intelligence and real-time analytics to track sales activity and staffing needs based on customer activity trends.

NFC, or Near Field Communication, is a subset of RFID technology. It uses the same foundational scientific principles, but it is more precise because the reader and tag need to be within a few inches of one another to work. This proximity helps address concerns about identifiers, such as information on a credit card being read by someone who shouldn’t have access to that information.

Because of this, Near Field Communication is commonly used for payment processing technologies, like credit and debit cards and mobile payments. When you tap your card or device onto a payment processing kiosk in a store, restaurant, or fee-based entry point, the card passes information to the reader. The electronic reader can then securely verify the details to authorize or decline the purchase based on the card’s validity.

While no technology is 100% invulnerable, RFID and NFC are both considered secure. They use standardized protocols when transmitting information and create individualized codes associated with each purchase. Additionally, the field of communication is limited to just where it's needed, making both technologies secure options for storing and transmitting information. This is why both technologies are used in both financial and secure access applications.

The Right Choice for a Secure POS System

An efficient point-of-sale system is essential to maximizing revenue, handling transactions quickly, and giving customers a positive experience to build consumer trust. If your event or venue needs a secure payment processing system built on technology people know and trust, count on Billfold. We provide point-of-sale solutions for event venues of all types and sizes and feature seamless and robust technology that can be customized to suit your needs.