Software Serial Library
The Arduino hardware has built-in support for serial communication on pins 0 and 1 (which also goes to the computer via the USB connection). The native serial support happens via a piece of hardware (built into the chip) called a UART. This hardware allows the Atmega chip to receive serial communication even while working on other tasks, as long as there room in the 64 byte serial buffer.
The SoftwareSerial library has been developed to allow serial communication on other digital pins of the Arduino, using software to replicate the functionality (hence the name "SoftwareSerial"). It is possible to have multiple software serial ports with speeds up to 115200 bps. A parameter enables inverted signaling for devices which require that protocol.
The version of SoftwareSerial included in 1.0 and later is based on the NewSoftSerial library by Mikal Hart.
The library has the following known limitations:
If using multiple software serial ports, only one can receive data at a time.Not all pins on the Mega and Mega 2560 support change interrupts, so only the following can be used for RX: 10, 11, 12, 13, 14, 15, 50, 51, 52, 53, A8 (62), A9 (63), A10 (64), A11 (65), A12 (66), A13 (67), A14 (68), A15 (69). Not all pins on the Leonardo and Micro support change interrupts, so only the following can be used for RX: 8, 9, 10, 11, 14 (MISO), 15 (SCK), 16 (MOSI).
On Arduino or Genuino 101 the current maximum RX speed is 57600bps.
On Arduino or Genuino 101 RX doesn't work on Pin 13
If your project requires simultaneous data flows, see Paul Stoffregen's AltSoftSerial library. AltSoftSerial overcomes a number of other issues with the core SoftwareSerial, but has it's own limitations. Refer to the AltSoftSerial site for more information.