1)As every new technology that is produced, the main limitation of an RFID system is
the fact that its very costly, since it performs many more applications than the older systems do, (barcodes and magnetic strips). It provides security, convenience, and most importantly it provides inventory control. Hence, its very high cost. (Despite that, Wal-mart implemented the use of RFID, to track and identify their inventory and keep record of all the products going into and out of the system.) Follow this link to learn more about it, http://www.rfidjournal.com/article/articleview/1385
2)RFID devices operate via radio waves which could cause harm in the environment after a period of time of its usage.
3)It creates a privacy problem, because in the instance of someone purchasing a product, the RFID tag would still be attached to it. And in the case of a fare collection system, an RFID has the ability to invade people's privacy and this creates an uncomfortable atmosphere for customers.
4)If the reader of the tag and the reciever are not properly aligned and in synch, a poor read rate can occur, which will eventually create problems and miscounts in the system.
5)RFID systems are very prone to being hacked, because they allow each user to be identified by a central database, which means that hackers will consider this as an easy access point to attack such systems to identify certain information and manipulate the system. The picture below demonstrates the information flow between computers and the RFID systems and their database:

6)Moreover, double charges may be incurred when multiple readers and recievers are operating at the same time, which makes this system even more costly.
References:
http://rfidintro.wetpaint.com/page/5.Advantages+&+Disadvantages?t=anon
http://rfidintro.wetpaint.com/page/7.Potential%20Misuses
http://www.ferret.com.au/c/GS1-Australia/PROS-AND-CONS-OF-RFID-n719191
http://www.webermarking.com/rfid.html?gclid=CInv-6aulJcCFQyfnAodLnuvBg







