RFID also known as Radio Frequency Identification is one of the most advanced technologies which is being used nowadays. It is a way of storing the information encrypted in a particular thing which is known as the Transponder. This transponder emits radio waves through which the information is transmitted to a receiver which is the RFID Reader. The RFID reader then decrypts or demodulates the information sent by the Transponder and sends it to the respective medium to which it has been attached. The usage of RFID has increased manifolds over the years as it has found use in almost all sort of monetary transaction measures. The concept of plastic money too has been based on this and has become possible only because of the presence of RFID technology. Though we seldom think of the importance of RFID but it has revolutionized our world and has made our life extremely simple.
Each RFID system has a RF tag which as mentioned above is the transponder. This tag is basically an electronically programmed tag which contains unique information. Thus it maintains the unique identity of the person to which it belongs. The encrypted information on the tag represents the person to which it belongs. RF tags can be of various types. However, they can be broadly categorized into two types namely Active RFID tags and Passive RFID tags.
1. Active RFID tags - Active RFID tags are self powered tags. This means that they are self-powered by an internal battery. Due to this they can perform their own action and they don't require the help of a reader to initiate read/write process. The data stored in Active RFID tags can be rewritten and modified. This makes it quite useful as a same RFID tag can be used for multiple purposes. Another major advantage of Active RFID tags is that they have quite a good amount of capacity to store data. There are some Active RFID tags which can store data up to 1 MB.
2. Passive RFID tags - Passive RFID tags are not self generated or self operated. They need external source of power to initiate the processes. Moreover Passive RFID cards can only be read. The contents of Passive RFID tags can never be changed. Thus these tags are used only for reading purpose. These tags require the RFID reader to initiate the reading proceedings without which the Passive RFID tag will not transmit the information through the way of radio waves.

Thus we saw the two major categories of RFID tags which have some advantages and some disadvantages in them but all of them are equally useful. Each of the categories has found profound usage in today's world.