The Ministry of Micro, Small and Medium Enterprises (MSME) is promoting quality-driven and environmentally sustainable manufacturing through the MSME Sustainable (Zero Defect, Zero Effect – ZED) Certification Scheme, with more than 6.7 lakh MSMEs receiving certification to enhance their competitiveness in domestic and global markets.
The scheme aims to help MSMEs improve manufacturing processes, adopt higher quality standards and reduce their environmental footprint. A major focus of the initiative is encouraging women entrepreneurs, with the government providing a 100 per cent subsidy on the cost of ZED certification for women-owned MSMEs since November 11, 2023, effectively making the certification free for eligible enterprises.
The certification enables enterprises to strengthen their manufacturing systems by adopting recognised standards in quality, productivity, workplace safety and environmental sustainability. According to the ministry, the initiative helps businesses improve operational efficiency, build market credibility and prepare for wider business opportunities.
The ZED framework offers Bronze, Silver and Gold certifications, allowing MSMEs to progressively improve their quality and sustainability standards. In addition to certification support, eligible enterprises can avail financial assistance of up to 75 per cent of the cost of testing, system or product certification (up to ₹50,000), ₹2 lakh for consultancy and handholding support, and ₹3 lakh for adopting cleaner technologies, pollution-control measures and Zero Effect solutions.
As of July 7, 2026, nearly 9.49 lakh MSMEs had registered under the scheme. Of these, over 6.67 lakh received Bronze certification, around 6,700 achieved Silver certification and about 4,800 secured Gold certification. The ministry said financial assistance exceeding ₹913 crore has been extended to help enterprises adopt quality and sustainable manufacturing practices.
The scheme has also gained support across the country, with 22 States and Union Territories integrating ZED into their industrial policies and offering additional incentives to certified MSMEs. Further, 19 financial institutions are extending benefits such as concessions in processing fees and interest rates to ZED-certified enterprises, improving their access to finance.
Highlighting the impact of the scheme, the ministry cited the example of Finex Industries Pvt. Ltd. in Nashik, Maharashtra, which achieved ZED Silver Certification in July 2025. The company reported an 11 per cent reduction in the Cost of Poor Quality (COPQ), 10 per cent reduction in rework, improved workplace safety and better resource utilisation after implementing ZED practices.
Another success story is Concept Clothing Pvt. Ltd. of Jalandhar, Punjab, which obtained ZED Silver Certification in June 2025. The enterprise recorded an 80 per cent reduction in workplace incidents, 50 per cent reduction in Mean Time to Repair (MTTR), 7.4 per cent reduction in rework, and 4 per cent reduction in product rejection, alongside improvements in process efficiency and operational discipline.
