The star has handed over the entirety of his £25k award cash to the Music Venues Trust, which functions to preserve the UK's small live music spots.
The star was given the award on October 16 as his new release People Watching was chosen as the best record of the past year.
The musician has decided to donate the funds to the Music Venues Trust, in recognition of the crucial part small stages had in his initial steps.
"I personally wouldn't be doing my current career if it wasn't for all the gigs I played around the region, and beyond, when I was just getting going," stated Sam Fender. "These spaces are legendary, but they are facing challenges."
Beginning in 2023, over 150 of these spaces have ceased operations – approximately 16% of the whole industry in the UK.
In the last year, top acts such as Pulp, Coldplay, Katy Perry and Ed Sheeran have all backed the Music Venues Trust in its efforts to help venues survive, by including a minor surcharge to their admission fees, which goes to help local stages.
Fender also took part, raising more than £100,000 on his 2024 arena tour to help thirty-eight local spots across the UK.
The donation assisted locations that were confronting imminent closure due to challenges arising from floods, fires and bereavements, as well as regulatory hurdles, court cases and sound issues.
Some locations were granted funding support in upgrading facilities and technical equipment that helped musicians and audiences.
"The notion that revenue from concerts in big venues helps the local stages, where it begins for performers like me, is just common sense," the star has commented.
Fender is not the first artist to contribute his Mercury Prize prize money to charitable organizations.
When they earned the prize in the year 1996 for their release their work, frontman the singer declared that the band would contribute their cash to the organization War Child.
During 2002, musician the artist split her award between several organizations, like the children's charity and a Sickle Cell organization.
"I also donated a grand to the center, to their gymnastics class, because I trained in gymnastics when I was growing up and they lacked better apparatus," Ms Dynamite told outlets.
Two years ago, the band gave their prize money to the youth organization that nurtured their act, in addition to other grassroots music organisations.
Also 1994 winners they contributed their prize to a charity for MS after a close contact was diagnosed the condition.
"Receiving the award was quite enough," said artist the singer. "The cash was the bonus but we didn't require the bonus, because we had the honor. So our victory impacted the lives of others."
Last week, the trust shared it had saved two grassroots venues in south-east England, by bringing them into local control.
One venue in that area and The Croft in that location were bought under the Own Our Venues program, which is supported by Arts Council England and enthusiasts who purchase "stakes" in the properties.
