I'd be grateful for an explanation of the technology's functioning.
It depends on the type of transponder being used. Passive low-frequency (LF) and high-frequency (HF) transponders have a coiled antenna that forms an electromagnetic field in the reader antenna. The reader and tag communicate through subtle changes in this field. It is sort of like two people with their hands on a balloon; one person could squeeze the balloon in specific patterns in order to communicate with the other.
Ultrahigh-frequency (UHF) transponders can be designed with a loop to work the same way, but most are built for longer-range communication. These UHF transponders use something called backscatter to communicate with the reader antenna. There is no electromagnetic field. Instead, the signals from the reader antenna induce a small electric current in the tag antenna, and the chip uses this current to modulate and demodulate the antenna in such a way that it can reflect back a signal to the reader antenna. The tag antenna might increase a wave's amplitude to indicate a one or a zero. It might shift the wave forward a half or quarter phase, or use some other technique to allow the reader to interpret the waves coming back as binary code.
Active RFID transponders broadcast a signal on their own, without receiving energy from the reader antenna. There are two ways that active RFID systems work. In some cases, the tag enters the area of a reader and the reader sends a signal (using passive RFID) to wake up the active tag. The active tag then sends out its unique ID number. With RFID-based real-time location systems, the tags are set to emit a signal every few seconds, minutes or hours, depending on how often you need to update their locations. Readers then pick up that signal, and software calculates each tag's location.
—Mark Roberti, Founder and Editor, RFID Journal