Big corporates have been slow to come on board with paying staff and contractors the living wage with just three to gain official certification since 2015.
Westpac will join AMP and Vector as the latest to get the stamp of approval from Living Wage Movement Aotearoa NZ - a non-profit organisation launched in 2014 to try and bring the wages of low-paid workers up to a high standard.
That means around 480 workers - cleaners, security guards and others who regularly contract to the bank - will be paid at least $20.55 an hour by 2020 as well as its permanent staff.
The minimum wage is currently $16.50 an hour for adult workers with the Government planning to lift it to $17.70 by April 1, and $20 an hour by 2021.
Lyndy McIntyre, a spokeswoman for the movement, said regular contractors were included in its accreditation as contracting was often used by businesses as a way of putting people on low wages.
McIntyre said it was really pleased that Westpac had also stepped up and called for others to do so as well.
She said in the United Kingdom financial companies were among the first to embrace the living wage.
"We are surprised it has taken large corporates so long- we are challenging other corporates to follow Westpac's lead," McIntyre said.
"These employers can afford to pay workers properly."
She said the change was good for the workforce and good for the economy and research showed it promoted stronger staff loyalty and better productivity.
The organisation had written to the 100 largest companies to ask them to adopt the movement but it did not have the resources to go out and "knock on doors" to make it happen.
She said it was typically innovative, smart, younger companies that had moved to the living wage like Little Island and Karma Cola.
"They are ethical businesses that really want to do the right thing.
"We would like to see the larger corporates look to the innovative and small businesses and think about what they can learn from them. They know consumers want their businesses to be ethical."
Simon Power, Westpac NZ general manager of consumer banking and wealth, said it had moved to a living wage for permanent staff several years ago and then wanted to expand it more broadly.
"We wanted to offer sustainable conditions to everyone at Westpac."
The bulk of its 480 permanent contractors would change in 2019 with some having an increase in 2020 due to contract changes being required.
Power said the cost of the change amounted to several million dollars.
But he hoped it would result in staff that were less stressed and people staying in their positions longer.
"Ultimately, we think it will benefit the economy and our business. But above all else, we think this is the right thing to do. These workers play an important role in our day-to-day operations and we value their efforts.
"As a large and influential employer, with a presence right across the country, paying a living wage is one way we can help to raise living standards."