David Azar helps a customer with Cardullo’s wine selection yesterday evening. The shop has started a program offering Harvard students 10 percent discounts with their new declining-balance cards.

When Frances R. Cardullo was approached by a Harvard University Dining Services (HUDS) employee to sign on to the Crimson Cash program, she was so incensed by Harvard’s demand to keep 8.5 percent of the cost of purchases made with the cash card that she decided to start a card of her own.

“American Express—the most expensive [credit card]—only charges 4.5 percent. Where do they come up with the nerve to [charge so much]?” said Cardullo, the president of Cardullo’s Gourmet Shoppe in Harvard Square, while checking out a steady stream of customers on Saturday at the specialty foods store.

The Cardullo’s Cash Card gives students or faculty 10 percent off any purchase at the store, as long as the customer maintains a minimum balance of $20. Since the card’s debut last week, according to Cardullo, about 25 people have signed on.“I’m going to take students’ money but I’m going to give something [back],” Cardullo said. “Harvard is a monstrous cash cow...[Crimson Cash] takes hundreds of thousands of dollars in student money.”

Indeed, of the approximately 120 merchants solicited by HUDS for participation in the program, only 17 have signed on since it was expanded to include local businesses last July.

“The program is off to a slower start than we hoped,” Assistant Director for Business Applications at HUDS Jeffrey B. Cuppett wrote in an e-mail.

But Cuppett wrote that there were no plans to reduce Harvard’s cut.

Tom Brush, the co-owner of Felipe’s Taqueria, said that he would accept Crimson Cash only if Harvard’s cut was under 4 percent.

“For our type of business we are trying to give the lowest cost and...Crimson Cash would add to cost,” he said. “We would have to build that into the cost of our product.” Felipe’s currently accepts no form of credit card.

Brush said merchants who accept Crimson Cash have to pass on Harvard’s cut to customers.

“People have to realize that when you use Crimson Cash, it’s costing you money. Any business [that participates] will have to raise prices 10 percent,” he said.

But Cuppett wrote that Crimson Cash’s cut was lower than similar programs at other colleges. He wrote that some charge “around 25% to pizza vendors” and that the advantages of the program outweighed the costs.

“Some [businesses] hone in on the expense side, while others realize the added income potential,” he wrote. “Almost every Harvard ID student carries a balance on Crimson Cash to do laundry, make copies...and businesses get passer-by impulse buying from people who have no reason to carry much cash, or use another card.”

He said that “HUDS uses the income to bring the program to the break-even point.” Cuppett wrote that the Crimson Cash program brought in less than $20,000 in income last year which “barely covers personnel, administrative and technology costs.”

But Brush said there were non-cost-related problems with Crimson Cash as well. He said that it takes an average of 45 days for the money to be transferred from Harvard to the local establishments and that it took an average of 10 seconds to complete every Crimson Cash transaction.

“That would slow down our ability to process food,” he said.