The star has given the full amount of his £25k honor cash to the Music Venues Trust, which functions to preserve the Britain's small music venues.
Fender was given the cheque on 16 October as his new release his work was declared the top album of the last 12 months.
The musician has opted to donate the funds to the trust, in recognition of the crucial part grassroots venues played in his early career.
"I personally would not have achieved my current career if it weren't for all the gigs I played around the North East, and beyond, when I was starting out," stated the artist. "These locations are legendary, but they are facing challenges."
Beginning in 2023, over 150 of these spaces have permanently closed – about 16 percent of the entire UK sector.
Over the past year, well-known musicians such as Pulp, the group Coldplay, Katy Perry and Sheeran have all supported the MVT in its attempts to keep the scene afloat, by including a small levy to their ticket costs, which benefits smaller concert halls.
Sam Fender also took part, raising over £100k on his recent tour to assist numerous grassroots venues across England, Scotland, and Wales.
The donation assisted locations that were confronting potential shutdown due to difficulties caused by flooding, blazes and personal losses, as well as licensing issues, court cases and sound issues.
Some locations were granted financial assistance in modernizing infrastructure and gear that helped performers and audiences.
"The notion that funds from performances in big venues supports the independent spots, where it all starts for musicians like me, is just logical," Sam Fender has said.
The musician is far from the only musician to contribute his Mercury Prize winnings to worthy causes.
In they won the trophy in 1996 for their album their work, vocalist the singer declared that the band would donate their winnings to the non-profit War Child.
In 2002, rapper and singer Ms Dynamite shared her award across multiple organizations, such as the children's charity and a Sickle Cell organization.
"I also donated a grand to my local community centre, to their classes, because I did gymnastics when I was younger and they needed updated gear," Ms Dynamite explained to the media.
Two years ago, the band contributed their winnings to the local youth club that developed their act, alongside other local music groups.
Additionally 1994 winners they contributed their winnings to a charity for MS after a close contact was found to have the disease.
"The victory was ample," said singer Small. "The money was the cherry on top but we could do without the bonus, because we had the main prize. So our success affected somebody else's life."
Last week, the Music Venues Trust revealed it had protected a couple of local spots in the South East, by bringing them into public stewardship.
One venue in the city and the second in that location were purchased under the community ownership initiative, which is funded by a national body and music fans who purchase "shares" in the buildings.
