The star has given the complete sum of his £25,000 award cash to the MVT, which works to preserve the Britain's grassroots music venues.
The star was awarded the award on 16 October as his third album his work was declared the top album of the past year.
He has chosen to hand the money over to the trust, in recognition of the essential function local spots played in his early career.
"I personally couldn't be pursuing what I am doing today if it hadn't been for all the gigs I did around the region, and elsewhere, when I was starting out," remarked Fender. "These spaces are iconic, but they are facing challenges."
From early 2023 onward, at least 150 of these spaces have permanently closed – approximately 16% of the total UK scene.
Over the past year, top acts such as the band Pulp, Coldplay, the singer Katy Perry and Ed Sheeran have all aided the Music Venues Trust in its efforts to keep the scene afloat, by adding a minor surcharge to their ticket prices, which benefits independent venues.
Fender also took part, collecting more than £100,000 on his 2024 arena tour to support thirty-eight local spots across Britain.
These funds helped venues that were confronting possible closure due to challenges arising from floods, fire incidents and family tragedies, as well as regulatory hurdles, court cases and noise complaints.
Additional spaces were granted monetary aid in modernizing amenities and gear that positively impacted musicians and fans.
"The concept that money from concerts in major spaces supports the local stages, where it begins for performers like me, is just common sense," Fender has stated.
The musician is not the first artist to contribute his Mercury Prize funds to charitable organizations.
When the band earned the trophy in the mid-90s for their record Different Class, frontman Cocker stated that the band would give their prize money to the charity War Child.
In 2002, artist Ms Dynamite shared her award among multiple good causes, like the children's charity and a Sickle Cell organization.
"Additionally, I contributed a £1,000 to the center, to their classes, because I practiced gymnastics when I was younger and they lacked new equipment," the artist shared with outlets.
Previously, they contributed their funds to the community center that nurtured their group, in addition to other grassroots music organisations.
And winners that year M People donated their winnings to a MS organization after a close contact was identified with the condition.
"Receiving the award was ample," said artist the singer. "The cash was the bonus but we didn't need the bonus, because we had the honor. So our winning affected somebody else's life."
Last week, the MVT announced it had rescued several small stages in south-east England, by transferring them to community ownership.
The first in Southampton and the second in Bristol were acquired under the Own Our Venues scheme, which is backed by the arts council and enthusiasts who acquire "stakes" in the properties.
