The artist has donated the complete sum of his £25k honor cash to the MVT, which functions to save the United Kingdom's independent concert spaces.
He was presented with the prize on October 16 as his latest record the album was declared the best record of the previous year.
The musician has decided to give the cash to the MVT, in recognition of the crucial part local spots had in his early career.
"I personally would not have achieved what I am doing today if it wasn't for all the performances I played around the North East, and further afield, when I was beginning," stated Fender. "These locations are renowned, but they are in difficulty."
From early 2023 onward, more than 150 of these locations have shut down – approximately 16 percent of the entire UK sector.
In the last year, well-known musicians such as the band Pulp, Coldplay, the singer Katy Perry and Ed Sheeran have all backed the MVT in its efforts to support the industry, by applying a minor surcharge to their ticket costs, which benefits independent venues.
Sam Fender also joined in, raising more than £100,000 on his 2024 arena tour to support 38 small stages across England, Scotland, and Wales.
These funds helped locations that were facing possible closure due to difficulties stemming from floods, fires and personal losses, as well as regulatory hurdles, legal disputes and sound issues.
Other venues received monetary aid in upgrading facilities and gear that positively impacted musicians and concertgoers.
"The notion that revenue from concerts in large arenas backs the local stages, where it all starts for artists like me, is just common sense," the star has stated.
He is not the first artist to donate his Mercury Prize funds to worthy causes.
When they received the prize in the mid-90s for their record Different Class, vocalist Cocker announced that the act would donate their winnings to the organization War Child.
During 2002, artist she divided her award across multiple good causes, such as the children's charity and a charity for Sickle Cell.
"I also donated a grand to my local community centre, to their classes, because I practiced gymnastics when I was growing up and they required new equipment," the artist told a publication.
In recent years, the band donated their winnings to the community center that developed their act, as well as other local music groups.
Also the 1994 recipients the group contributed their award to a charity for MS after a close contact was diagnosed the condition.
"Winning was ample," said artist Heather Small. "The cash was the extra but we didn't need the extra, because we had the cake. So our winning affected the lives of others."
In the past week, the MVT announced it had saved a couple of small stages in the South East, by transferring them to community ownership.
One venue in Southampton and the other in that location were acquired under the community ownership initiative, which is backed by Arts Council England and supporters who purchase "stakes" in the venues.