Japanese bank taps RFID for document security

NEC Corp. has signed a contract with a Japanese bank for an RFID (Radio Frequency Identification) -based document management system, the company said Tuesday in a statement.

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The system, which NEC claims is the world's first system to use RFID for this function, will be introduced by the Bank of Nagoya Ltd. in April 2005, NEC said. Bank of Nagoya is a regional bank in central Japan. Financial details of the agreement were not disclosed.

The system, which is still under development, will use omni-directional antennas attached to bookshelves and filing cabinets that communicate data from RFID tags embedded in documents to a software system that offers real-time document tracking, according to Motofumi Yamamuro, an NEC spokesperson. NEC is co-developing the system with Nikko Telecommunications Co. Ltd, a computer systems sales company.

Yamamuro said the system, which NEC is targeting at banks, financial institutions, libraries, hospitals and other institutions that store sensitive documents, is designed to be combined with other security systems to provide comprehensive and detailed document protection. When combined with employee identification systems using cards or fingerprint sensors or tags, the RFID system could help enable real-time recording of which employees are removing or replacing which documents, whether authorized or not, from a filing cabinet or room.

"We see this system working on top of, or in combination with, a number of other systems to provide high-security document protection...Say, for example, a person manages to take a document that he or she is not authorized to access, the system could sound an alert to warn a security systems person of this," Yamamuro said.

In a March 2004 survey of 450 wireless developers, Evans Data Corp. a U.S.-based market research company reported that RFID security and access control applications are the most likely RFID technologies that companies will deploy over the next two years. The company predicted that the global market for RFID-based security and access control applications could grow 450 percent over the next 12 months and a further 95 percent in 2006.

NEC also claims the system will aid workflow management and inventory. For example, in a case study conducted for the Bank of Nagoya that assumed the system used 100,000 tags, NEC calculated the bank would save about ¥6 million ($54,000) per year for inventory checks compared to having staff manually conduct the process using bar codes and readers. Yamamuro said NEC would not disclose the total cost of conducting the inventory process using staff and bar code readers in the case study on confidentiality grounds.

"But we can say that the major cost reduction came from reduction in personnel time and costs," Yamamuro said.

NEC won't reveal technical specifications or costs of the antennae and software yet because the system is still "under development," Yamamuro said. However the software management system, that can be installed on servers and workstations, will cost "about ¥3 million," he said.

A key feature of the system is its ability to read data from a number of already commercially available RFID tags and chips, including the myu chip from Hitachi Ltd., and RFID tags developed by Omron Corp., Fujitsu Ltd and Toppan Printing Co. Ltd., said Yamamuro.

The number of companies making RFID tags and developing related technologies and applications is growing in Japan. The technology has been used in a number of Japanese government and private sector trials that have uses ranging from baggage tracking and security at airports to the labeling of fresh produce to show when and where it was grown. One trial organized by Japan's Ministry of Public Management, Home Affairs, Post and Telecommunications covers 18 fields including areas such as food distribution and involved about 200 companies, research institutes and companies. Another trial run by Japan's Ministry of Economy, Trade, and Industry focuses on tagging home appliance sales.

Japan's RFID industry is estimated to have been worth ¥3.8 billion in 2003 and will grow to be worth ¥24.3 billion by 2010, according to a report published in January this year by local market research company Yano Research Institute Ltd.

The system will also be able to read the NetLabel brand RFID chip being developed by NEC Electronics Corp, Yamamuro said.

NEC Electronics announced NetLabel in Jan. 2004. At the time, the company estimated its group sales of RFID products would reach ¥200 billion in 2010.

Samples of NetLabel started shipping to customers this June, said NEC Electronics spokeswoman Sophie Yamamoto. First-generation chips measure 1.3 millimeters square, include a built-in antenna, and can store up to 1K bit of information. "We are currently developing a second-generation chip that will have smaller geometries, but we are working with other developers and can't disclose any details yet," Yamamoto said.