This is an incorrect procedure.
Player A bets 100, Player B calls. Player C raises to 500, puts 500 out and takes the 100 from Player B?
Why this wrong...
- Player D could think the bet was 500 to him
- Player D could think he's heads up vs A
- Player B could be skipped on the next orbit.
- Player B could claim he had raised to 200.
Sure, you may not have ever had to deal with these (or other) issues, but there is a reason that change is never taken out of the pot until
all action is complete.
Also, if you have dedicated dealers, this is less of an issue, but when you do a rotating deal on a 10 player table, making change becomes more inconvenient as the dealer is often further from the player needing change.
The only reason to have just 20 chips in a stack is because it makes a chip-set cheaper (a valid issue with 40 player set-up) or your players hate chips (which seems to be the case in your group).