Sustainability for MSMEs: The MSME Sustainable (ZED) Certification scheme launched by the government in April this year — to encourage MSMEs to improve their manufacturing processes and systems to enhance quality and move towards sustainability — has registered more than 22,000 enterprises so far. According to the data shared by the minister of state for MSMEs Bhanu Pratap Singh Verma in a written reply to a question in the Lok Sabha on Thursday, out of total registrations, 734 MSMEs were awarded bronze certification while 32 MSMEs won silver certification and 25 were awarded gold certification.
The remaining registered MSMEs are currently under process for certification subject to the fulfilment of assessment criteria, Verma said.
According to the scheme, there are 20 parameters for the certification. While bronze certification marks MSMEs on five parameters including workplace safety, quality management etc., the silver certification has 14 parameters to comply with. On the other hand, gold certification involves 20 parameters such as supply chain management and corporate social responsibility.
During the launch, the government had also proposed an 80 per cent subsidy on the certification cost for micro enterprises, 60 per cent for small enterprises, and 50 per cent for medium enterprises. Moreover, an additional 10 per cent subsidy for women or SC/ST entrepreneurs-owned units was proposed.
Among benefits, MSMEs certified under the scheme will be offered subsidies up to Rs 1 lakh in stall charges, up to Rs 75,000 in airfares, and up to Rs 25,000 in freight charges for participating in business exhibitions and fairs abroad. Certified MSMEs would also be eligible for concession in banks’ processing fees and rate of interest along with preference in lending. Also, the credit rating of certified MSMEs is likely to improve, according to the scheme’s details during its launch.
For the uninitiated, the MSME Sustainable (ZED) Certification ZED scheme is actually the revamped version of the earlier Zero Defect, Zero Effect (ZED) scheme. The erstwhile ZED scheme was launched in October 2016 by Prime Minister Narendra Modi to help reduce wastage in the manufacturing process substantially, increase the productivity of MSMEs, enhance their environmental consciousness, save energy, expand their markets, etc., in order to boost MSMEs’ competitiveness.
Importantly, to ease credit to access the certified MSMEs, the government’s credit guarantee scheme under the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) was extended to MSEs certified with the Zero Defect and Zero Effect (ZED) scheme along with women and SC-ST entrepreneurs, and MSEs based in aspirational districts in the country. The announcement was made via a circular by CGTMSE on November 30, 2022.
Subscribe to Financial Express SME newsletter now: Your weekly dose of news, views, and updates from the world of micro, small, and medium enterprises