RFID chips, or Radio Frequency Identification chips, are small electronic devices that use radio waves to transmit data. They consist of a microchip and an antenna, allowing them to communicate with a reader device. RFID chips are commonly used for tracking items, such as in inventory management or supply chain logistics, and can be found in various applications, including contactless payment systems and access control. These chips come in two main types: passive and active. Passive RFID chips do not have their own power source and rely on energy from the reader to function, while active RFID chips have a built-in battery that allows them to transmit signals over longer distances. RFID technology enhances efficiency and accuracy in various industries by automating data collection and reducing human error.