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When we speak about EMV and level 2 kernels (contact and contactless), we expect them to be embedded inside the POS terminals. But times have changed with the introduction of Cloud Kernels.
Cloud kernels reduce the cost and time required to launch your terminals in the market.
EMV cloud kernel payments represent an original architectural shift, not just an incremental improvement to the embedded model. Moving the L2 kernel out of the terminal and into the cloud changes how terminal vendors, acquirers, and payment networks approach certification. It also changes maintenance and hardware lifecycle management.
The question is, if it has so many advantages, why are terminal vendors hesitant to implement it? Some of the reasons could be:
Transactions will complete faster if the Level 3 application and the cloud kernel are connected through a good internet connection. There may be a delay when conducted through a 3G or 4G network, which can result in latency.
In addition to the EMV secure protocols, you should get PCI DSS certification to transfer card and cardholder information to the cloud securely.
When the cloud kernel was first launched, only a small number of kernel vendors had cloud kernel certification. This is one of the reasons for lower adoption. However, payment networks and EMVCo have begun supporting the cloud initiative and have upgraded the L2 certification process to accommodate different parts of the L2 kernel running on different platforms.
Cloud kernel payment terminal vendors that adopted early had fewer certified kernel options, limiting flexibility in vendor selection. That landscape has changed considerably as more kernel vendors have pursued cloud kernel L2 certification, giving terminal vendors a wider set of options today than existed even a few years ago.
Without the internet, a cloud kernel will not work, as the transaction must pass through the kernel.
As far as we know, payment brands restrict themselves from providing L2 certificates to cloud-based level 2 contactless kernels if the EMV kernel is not meeting expected transaction speeds.
Discounting these slim negatives, one should consider the advantages of using cloud kernels carefully. Let us list them below:
Once you receive L2 certification for the cloud kernel, you will have to get certification only for the L3 application when you integrate it with the kernel. With this process in place, you don't have to go through the full L2 certification, which includes certifying the entire device and the kernel platform, saving a lot of time in bringing the terminal to market.
Cloud EMV L2 kernel certification decouples kernel certification from terminal hardware certification, fundamentally changing the economics for terminal vendors managing multiple device models. A vendor with five terminal models running the same cloud kernel needs to certify the kernel once, not five times.
As the kernel is running in the cloud, if there is an update or change in the kernel config files, it can be directly patched in the cloud instead of pushing it individually. As with embedded kernels, you must complete regression testing before patching the kernel. It is also easy to roll back the patch if any unexpected performance occurs.
In the current scenario, the L2 kernel runs only on the OS platform on which it is ported. If you need to port it to any other OS platform, the L2 testing and certification should again be done from scratch, which is not the case with cloud kernels, as they are not dependent on the hardware OS.
Cloud-based EMV kernel architecture means a terminal vendor supporting multiple OS platforms across their device fleet does not need to repeat the full certification cycle for all their platforms. The kernel remains the same, and only the terminal-side integration needs validation.
In current terminal-integrated kernels, there are storage limitations for transaction log storage and retrieval. This is not the case with cloud kernels, as there are no restrictions on data storage.
Cloud kernel payment terminal deployments benefit considerably from this capability during live troubleshooting. When a transaction issue occurs in the field, having full historical log data available in the cloud, without the storage constraints a terminal's local memory imposes, makes root cause identification faster and more reliable.
The same test tools and scenarios used for testing embedded kernels can be used to test cloud kernels. Teams do not need to invest in new tooling or rebuild test expertise to work with the cloud kernel model.
In the present scenario, L2 kernels run on the terminal side in the L1 memory. Suppose the terminal vendor wants to add one more kernel to the same terminal; if memory is insufficient, the vendor needs to upgrade or change the L1. In the cloud kernel, there are no memory restrictions.
EMV kernel cloud certification is growing faster, making the cloud model practical for a wider range of terminal vendors, not just the largest players. As more payment networks update their certification frameworks to accommodate cloud kernels, certification becomes more predictable and less dependent on navigating issues that earlier adopters had to handle.
For terminal vendors managing device fleets across multiple markets, considerations for cloud-kernel payment terminals increasingly favor the cloud model on cost alone. The reduced certification burden of certifying an extra terminal model or OS platform increases sooner. The operational advantages around patching, troubleshooting, and memory management add further value on top of the certification savings.
With the advancement in cloud technologies and the introduction of cloud POS in the payments business, cloud kernel has matured as a reliable way to reduce your L2 testing and certification costs. For terminal vendors evaluating their next-generation devices, the cloud kernel model deserves serious consideration alongside the traditional embedded approach.
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