Rishi Sunak will announce an overhaul of the government’s bailout scheme for businesses tomorrow in response to mounting criticism. Banks will be banned from asking small firms for personal guarantees on loans and relax other rules to ensure businesses can access the money they need.

Companies trying to use the emergency loan scheme said banks had been demanding the guarantees and charging double-digit interest rates.

The chancellor announced the scheme last month in which the state underwrites 80 per cent of the risk of bank loans of up to £5 million.

There were reports that one in five small companies would not survive the next month due to the lockdown.

Alok Sharma, the business secretary, warned banks that they must offer people more support. He