Mandy Ford is one of thousands of small business owners asking whether their banks betrayed their trust when they were sold complex interest rate swap products.

"When you are a small business, you feel like you are working with the bank, you are in a relationship, and you are all working for the best interests of the business," says Mandy Ford, the former owner of a hotel in Glasgow's west end.

"The rules have changed. It is now every man for himself and buyer beware."

Endowment mortgages and payment protection insurance, sold in branches by your friendly successor to Captain Mainwaring, have cost banks £12 billion in mis-selling compensation.

Now it is the turn of small businesses, the engine of the UK's stuttering recovery, to ask whether their banks betrayed their trust.

Ms Ford says that in 2007 Bank of Scotland, then part of HBOS, made an interest rate swap agreement (IRSA) a condition of the hotel's £420,000 borrowings. "They were phoning us saying 'have you signed the contract – interest rates are going up' ."

However, rates were actually on their way down, and the deal ended up forcing Ms Ford to sell the third-generation business after a period which saw the diagnosis of her late mother with cancer and the death of her grandmother.

She then spent 12 months fighting the bank through the financial ombudsman, which rejected the complaint. Lloyds Banking Group said: "This is not a product that we have sold widely or in large volumes. Of the very small number of complaints we have received, just a small proportion have been taken as far as the ombudsman and, of those, the majority have been ruled on in our favour."

More than 40 other businesses contacted by The Herald were overwhelmingly customers of 83% taxpayer-owned RBS, from across the UK. They span sectors from pubs and hotels to retailing and manufacturing, care homes and property.

Most do not want to be identified because they are at the bank's mercy for continued funding. Some are preparing a legal claim against it.

RBS told The Herald last month it has "proper procedures" to govern the sale of regulated products, and declined to add to that comment.

But Paul Adcock of the Bully Banks campaign says: "This is a time bomb left behind by Fred Goodwin and his global banking markets division." The division, now renamed international markets, handled all financial instrument sales.

The financial ombudsman has since 2009 rejected 66 of 67 complaints against RBS relating to the sale of IRSAs. The banks' principal argument is that their contracts with businesses include disclaimers that the bank "does not give advice".

But the FSA's conduct of business rules still require the banks to ensure that the product they sell is appropriate, in the customer's best interests, and fully understood.

The owner of a fourth-generation manufacturing business told The Herald: "I didn't suddenly wake up one morning, become a derivatives trader, and pick up the phone to request one of these exotic products. If believing these products were in my best interests and presenting them to me is not giving advice, then what is?"

The owner of a home for people with learning disabilities, which is under severe financial pressure from its IRSA, says: "The bank effectively endorsed the product by promoting it in the first place. If we had known that the bank 'expert' was a salesman, we would have been far more wary."

One-third of 44 businesses surveyed by Bully Banks had been with their bank for more than 20 years.

One property developer said: "I had been with RBS/Natwest for more than 15 years and trusted my account manager. She said it would not cost me anything and was a condition of my loan renewal. Since then I have paid £800,000 extra in interest and face a settlement of £1.3m – it has almost crippled the business."

A lorry park operator said: "I was told it would cost me nothing to protect the business. So far it has cost £150,000 and could cost the business and around 35 jobs."

Another entrepreneur said: "I treated the manager as a friend. The sales process took half an hour and then we went to the pub to talk about football."

A care home owner said: "We had asked RBS for a 'worst case scenario' of break fee, and they had stated £50,000 – it turned out to be £525,000."

A nursing home owner has complained to RBS that an "expert" had been "introduced as an adviser", but was "likely to have been a salesman earning significant levels of commission".

Cat McLean at law firm MBM Commercial in Edinburgh, said: "The profit margin on these products can be very important to the bank – in some cases, the hedges can be a significant contributor to the total profit on a lending transaction."

Some businesses are contemplating legal action. But one developer said: "Two letters alone have cost us over £10,000 in legal fees and to take a case to court will cost in the region of £500,000. RBS have advised that the cost to break the hedge is £950,000. We simply do not have the funds either to pay the hedge or to take a case to court."