The star has handed over the full amount of his twenty-five thousand pound award cash to the MVT, which works to preserve the Britain's grassroots concert spaces.
The star was presented with the award on October 16 as his latest record the album was declared the top album of the previous year.
He has decided to donate the funds to the Music Venues Trust, in acknowledgment of the crucial part small stages had in his beginning days.
"I personally wouldn't be doing my current career if it weren't for all the performances I played around the North East, and beyond, when I was just getting going," remarked Sam Fender. "These venues are renowned, but they are facing challenges."
Beginning in 2023, over 150 of these spaces have permanently closed – about 16% of the whole industry in the UK.
In the last year, top acts including Pulp, Coldplay, Katy Perry and Ed Sheeran have all aided the MVT in its attempts to keep the scene afloat, by applying a small levy to their admission fees, which supports smaller concert halls.
Fender also joined in, collecting over £100k on his recent tour to help 38 local spots across the UK.
The donation helped venues that were confronting possible closure due to challenges arising from flooding, fires and bereavements, as well as licensing issues, court cases and sound issues.
Some locations were granted funding support in upgrading facilities and technical equipment that positively impacted performers and concertgoers.
"The notion that revenue from shows in large arenas backs the local stages, where it kicks off for musicians like me, is just sensible," Fender has stated.
Fender is among several artists to contribute his Mercury Prize prize money to worthy causes.
In they received the award in the year 1996 for their album Different Class, frontman Cocker stated that the act would give their cash to the non-profit the charity.
That year, artist Ms Dynamite split her prize between multiple charities, such as the NSPCC and a charity for Sickle Cell.
"And I gave a thousand pounds to my local community centre, to their classes, because I practiced gymnastics when I was a child and they needed new equipment," she shared with outlets.
Two years ago, the band contributed their winnings to the local youth club that developed their group, alongside other local music groups.
And the 1994 recipients M People gave their prize to a multiple sclerosis charity after a acquaintance was found to have the illness.
"Winning was quite enough," remarked vocalist Small. "The prize was the extra but we didn't require the cherry, because we had the cake. So our success touched somebody else's life."
Last week, the trust shared it had rescued two grassroots venues in the South East, by bringing them into local control.
The first in the city and the second in that location were bought under the community ownership initiative, which is backed by Arts Council England and music fans who acquire "stakes" in the buildings.
