The Global Chip Shortage & how it affects your RFID cards

If you have a card project coming up that requires RFID chips like MIFARE or DESFire, the advice is to move early while stocks are still good and before prices rise

Contactless cards are just one
product that will be hit by the shortage

Earlier today (18th March 21), Samsung warned of a deepening crisis regarding the availability of semiconductor chips.

The shortage has been well documented over the last few months. Whereas up to now it has mainly affected car manufacturers, Samsung warns that it now threatens to affect the technology sector as a whole.

It’s an issue that prompted President Biden to sign an executive order to assess the supply chain of semiconductors at the end of February, and whether demand will outstrip supply as the US economy recovers.

What exactly are these chips?

Semiconductors, or ‘chips’ are used to power all kinds of electronics and are in most of the things we use, from your phone to your electric vehicle and door entry fob.

They’re also the technology contained in many plastic cards, from your transport or travel card to your hotel key card, student ID card, membership card or access control card.

Stocks of these chip cards, also known as RFID cards, will be hit – just like everything else that uses semiconductors.

Why the shortage?

There are a number of reasons.

We first experienced supply issues in early 2020 when factories in China and the Far East (where most semiconductor chips are manufactured) closed due to COVID-19.

Since then, demand has yo-yoed, which means manufacture has too.  

When vehicle sales fell across the world due to the Pandemic last year, car makers slashed their orders. When they recovered later in the year, the supply of chips were already committed to other industries.

Then there were geopolitical issues (Trump and Huawei for example) and global transportation challenges during COVID.

All of which has combined to produce a situation where demand is up, goods are more difficult to get hold of, and prices are rising.

It’s difficult to predict exactly how it will impact on RFID card stocks this year

MIFARE is NXP’s brand for contactless solutions and is the most popular technology used in transit, payment & access applications.

It’s likely that shortages in chips will happen in bursts throughout 2021, which is why we’re advising all our customers to consider bringing forward their card projects to ensure supply.

We are also expecting price rises across the board.

If you’re planning on using large numbers of MIFARE, DESFire or any other kind of smart cards at some stage this year, you may want to order now to avoid any price shocks and delays.

At the moment, we have good access to stocks of RFID cards – both blank and custom printed, but it’s a moveable feast.

If we can help with quotes or sample cards for you to test with your system, please get in touch.