The star has handed over the complete sum of his £25k award cash to the Music Venues Trust, which operates to protect the United Kingdom's grassroots concert spaces.
Fender was awarded the prize on October 16 as his third album his work was chosen as the best record of the previous year.
Fender has chosen to donate the funds to the MVT, in recognition of the crucial part small stages played in his early career.
"I personally would not have achieved what I am doing today if it weren't for all the performances I did around the region, and beyond, when I was just getting going," stated the artist. "These venues are legendary, but they are struggling."
Since the start of 2023, more than 150 of these locations have ceased operations – about 16% of the whole industry in the UK.
In the last year, major artists such as Pulp, Coldplay, Katy Perry and Sheeran have all supported the Music Venues Trust in its efforts to keep the scene afloat, by applying a minor surcharge to their ticket prices, which supports local stages.
Sam Fender also joined in, generating more than £100,000 on his 2024 arena tour to help thirty-eight small stages across Britain.
These funds assisted spaces that were facing potential shutdown due to issues caused by water damage, fires and family tragedies, as well as licensing issues, court cases and neighbor objections.
Some locations were granted funding support in modernizing facilities and gear that helped artists and fans.
"The idea that funds from concerts in large arenas backs the smaller venues, where it kicks off for musicians like me, is just sensible," Fender has said.
The musician is far from the only musician to donate his Mercury Prize funds to worthy causes.
In the band received the prize in the year 1996 for their album Different Class, vocalist the singer declared that the band would give their cash to the organization the charity.
During 2002, musician the artist shared her prize across several organizations, such as the children's charity and a Sickle Cell organization.
"Additionally, I gave a thousand pounds to my local community centre, to their gymnastics class, because I practiced gymnastics when I was growing up and they required updated gear," Ms Dynamite told the media.
Two years ago, the band contributed their winnings to the community center that supported their act, in addition to other independent music bodies.
Also winners that year M People contributed their prize to a charity for MS after a close contact was identified with the illness.
"The victory was sufficient," stated artist Heather Small. "The prize was the cherry on top but we could do without the bonus, because we had the cake. So our victory touched another person's life."
Last week, the trust revealed it had protected several grassroots venues in the South East, by bringing them into community ownership.
The first in the city and the other in the city were bought under the Own Our Venues scheme, which is backed by the arts council and enthusiasts who acquire "ownership units" in the buildings.
