The star has donated the full amount of his £25k award prize money to the Music Venues Trust, which works to protect the United Kingdom's small music venues.
Fender was presented with the award on mid-October as his third album People Watching was declared the top album of the last 12 months.
He has decided to donate the funds to the trust, in appreciation of the essential function small stages had in his early career.
"I personally wouldn't be doing my current career if it wasn't for all the performances I played around the region, and beyond, when I was just getting going," said Fender. "These spaces are iconic, but they are facing challenges."
Beginning in 2023, more than 150 of these venues have shut down – about one-sixth of the total UK scene.
Recently, top acts including Pulp, Coldplay, Katy Perry and Ed Sheeran have all aided the Music Venues Trust in its initiatives to help venues survive, by applying a small levy to their ticket prices, which benefits independent venues.
Sam Fender also joined in, collecting over £100k on his recent tour to support numerous grassroots venues across the UK.
The money helped locations that were confronting potential shutdown due to issues arising from flooding, blazes and personal losses, as well as regulatory hurdles, legal disputes and sound issues.
Additional spaces obtained financial assistance in upgrading facilities and sound and lighting systems that helped performers and audiences.
"The concept that money from shows in big venues helps the local stages, where it kicks off for musicians like me, is just common sense," Fender has said.
The musician is far from the only musician to give his Mercury Prize winnings to good deeds.
In Pulp received the prize in the mid-90s for their record Different Class, vocalist Jarvis Cocker stated that the band would donate their cash to the organization the charity.
In 2002, rapper and singer Ms Dynamite split her prize among a few organizations, including the NSPCC and a charity for Sickle Cell.
"Additionally, I donated a grand to the center, to their classes, because I trained in gymnastics when I was growing up and they needed new equipment," the artist shared with a publication.
In recent years, the band contributed their winnings to the youth organization that supported their act, as well as other grassroots music organisations.
Additionally winners that year M People donated their prize to a multiple sclerosis charity after a close contact was diagnosed the condition.
"Winning was quite enough," remarked vocalist Small. "The cash was the cherry on top but we didn't require the bonus, because we had the cake. So our winning touched the lives of others."
In the past week, the trust revealed it had saved several local spots in south-east England, by transferring them to public stewardship.
One venue in Southampton and The Croft in that location were purchased under the community ownership initiative, which is backed by the arts council and supporters who acquire "shares" in the properties.
