The star has donated the complete sum of his £25k award prize money to the Music Venues Trust, which functions to protect the United Kingdom's grassroots live music spots.
The star was awarded the award on October 16 as his third album People Watching was named the outstanding release of the previous year.
The musician has decided to give the cash to the Music Venues Trust, in appreciation of the vital role small stages had in his initial steps.
"I personally wouldn't be doing what I am doing today if it hadn't been for all the gigs I did around the region, and elsewhere, when I was beginning," said Sam Fender. "These spaces are iconic, but they are in difficulty."
From early 2023 onward, more than 150 of these locations have ceased operations – roughly 16 percent of the total UK scene.
Over the past year, top acts such as Pulp, Coldplay, the singer Katy Perry and Ed Sheeran have all backed the Music Venues Trust in its initiatives to help venues survive, by applying a small levy to their ticket costs, which supports independent venues.
Sam Fender also took part, raising over £100k on his 2024 arena tour to help thirty-eight small stages across England, Scotland, and Wales.
The donation helped spaces that were facing potential shutdown due to issues caused by water damage, fire incidents and family tragedies, as well as regulatory hurdles, conflicts and noise complaints.
Additional spaces were granted financial assistance in improving amenities and gear that helped musicians and fans.
"The idea that funds from concerts in large arenas supports the local stages, where it kicks off for musicians like me, is just sensible," Fender has commented.
He is not the first artist to contribute his Mercury Prize prize money to worthy causes.
When they received the trophy in the year 1996 for their record Different Class, lead singer the singer stated that the group would give their cash to the organization War Child.
In 2002, musician Ms Dynamite divided her bounty across several organizations, including the NSPCC and a Sickle Cell organization.
"Additionally, I gave a grand to the center, to their classes, because I did gymnastics when I was younger and they lacked better apparatus," Ms Dynamite explained to the media.
In recent years, Ezra Collective contributed their prize money to the local youth club that nurtured their group, in addition to other local music groups.
And 1994 winners the group contributed their winnings to a multiple sclerosis charity after a friend was found to have the disease.
"Winning was quite enough," stated singer Heather Small. "The cash was the bonus but we didn't need the cherry, because we had the honor. So our success impacted somebody else's life."
Last week, the MVT shared it had protected two grassroots venues in that region, by placing them under public stewardship.
The Joiners in that area and the other in the city were purchased under the public acquisition scheme, which is backed by Arts Council England and music fans who purchase "stakes" in the properties.