The debate between RFID and smart cards technology is an ongoing one. There is no clear definition that describes RFID and smart cards, and at times these two terms are used interchangeably, due to lack of awareness, resulting in confusion between the differences.
Confusion is especially strong between contactless smart cards and RFID. The key issue that has given rise to this debate is the contact less interface and that too an RF (radio frequency) one. Both contactless smart cards and RFID use radio frequencies for communicating between the card and reader. The applications for which RF is used can be different for RFID and smartcards. RFID is mainly meant for applications within the supply chain, for track and trace. Contactless smart cards on the other hand are mainly meant for payments/banking, mass transit, government and ID, and access control.
RFID and smart cards both can be used in transit applications and most of the time they are used together to provide increased convenience to end users. An example of this would be the “Touch n go” cards in Malaysia used on toll ways. The Touch n Go card is a contactless smart card, but this card can be purchased with an additional RFID transponder (where the smart card will be inserted) so that the toll booth reader can read the cards from a greater distance than the 10cm limit restricted by smart card standards. Without the additional RFID transponder, the contactless Touch n Go smart cards can still be used, which means that the driver need to screen down their windshield to tap the card on the reader, instead of just driving through while the RFID transponder will be detected by the reader above the toll booths at a greater distance.