Application of RFID Technology in Banking Sector

Application of RFID Technology in Banking Sector

Lotfollah Forozandeh Dehkordi (Payame Noor University, Iran), Ali Ghorbani (Payame Noor University, Iran) and Ali Reza Aliahmadi (University of Science & Technology, Iran)
DOI: 10.4018/978-1-61520-635-3.ch009
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Abstract

Nowadays, the banks are using new technologies to provide better services to customers. One of these new technologies is RFID. In this chapter first a brief introduction presented about RFID technology and its components. Then, some applications of RFID in banking sector such as RFID applications in the cheques between banks, reducing the manual operation, customer relationship management, tracking and tracing, money transferring system, countering counterfeiting, contactless smart cards, people identification, phone banking, establishing security, checking purpose and so on are explained. Finally some of the barriers to technology acceptance by the customers and some methods to data protection and increasing security in RFID systems are described.
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Introduction

Technological developments particularly in the area of information technology are revolutionizing the banking industry. With the development of this technology, Commercial banking is undergoing rapid change.

Radio frequency identification (RFID) is a seemingly simple technique. Data is stored in RFID tags that are attached to objects or located in Smart cards, and this data can be read using radio signals and presented on a display by using a suitable reader. The data can then be transmitted automatically to an information technology (IT) system for further processing (Hasen &Gillert, 2008). The appeal of this technology is its convenience and efficiency offered to both the consumers and the merchants. (Banks, Pachano,Thompson & Hanny, 2007)

Figure 1.

RFID’s ability to perform as an auto-identification technology was first utilized by the Royal Air Force in World War II to differentiate between friendly and enemy aircraft. Friendly planes were equipped with bulky “active” RFID transponders (tags) energized by an attached power supply and interrogated by an RFID transceiver (reader). Applications today rely on similar communication between RFID tag and reader, although the tags (miniscule microchips attached to antennae) are generally “passive,” powered by an electromagnetic field emitted by the reader. Radio signals inform nearby readers of a serial number stored on the tag that uniquely identifies any item bearing the tag. (Angell & Kietzmann, 2006). Table 1 shows RFID application fields.

Table 1.
RFID application fields
RFID Application FieldsDescription
Mainly Object TaggingA. Logistical Tracking & TracingSolely identification and location of goods and returnable assets (e.g., pallets or containers)
B. Production, Monitoring and MaintenanceSmart systems in combination with RFID-Technology to support production, monitoring, and maintenance of goods and processes
C. Product Safety, Quality and InformationApplications to ensure quality (e.g., sensors to monitor temperature) and product safety (e.g., fight against counterfeiting)
Tagging with Reference or Potential Reference to IndividualsD. Access Control and Tracking & Tracing of IndividualsSingle function tags for identification and authorisation applications for entry control and ticketing
E. Loyalty, Membership and PaymentSmart Card based identification and authorisation systems for multifunctional applications (e.g., loyalty, payment, and banking systems)
F. eHealth CareSystems for hospital administration and smart systems to support and monitor health status
G. Sport, Leisure and HouseholdSports applications, rental systems (e.g., cars or books), smart home
H. Public ServicesSystems mandated by law or to fulfill public duties (e.g., ID-Cards, Health Insurance Cards, Road Tolling Systems)

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