The star has given the complete sum of his £25,000 award cash to the MVT, which works to protect the UK's small live music spots.
He was awarded the cheque on October 16 as his latest record his work was named the best record of the previous year.
He has decided to give the cash to the Music Venues Trust, in appreciation of the vital role grassroots venues played in his early career.
"I personally would not have achieved this success if it weren't for all the performances I did around the area, and further afield, when I was starting out," said the artist. "These spaces are renowned, but they are facing challenges."
From early 2023 onward, over 150 of these venues have permanently closed – about 16 percent of the total UK scene.
Over the past year, major artists including Pulp, Coldplay, Katy Perry and Sheeran have all backed the Music Venues Trust in its initiatives to help venues survive, by applying a modest fee to their ticket prices, which supports local stages.
Fender also took part, raising in excess of £100,000 on his recent tour to assist 38 local spots across England, Scotland, and Wales.
The donation supported spaces that were facing potential shutdown due to issues stemming from flooding, fire incidents and family tragedies, as well as permit problems, legal disputes and sound issues.
Other venues received financial assistance in improving infrastructure and sound and lighting systems that helped performers and fans.
"The notion that revenue from concerts in major spaces helps the independent spots, where it kicks off for performers like me, is just common sense," the star has stated.
Fender is far from the only musician to give his Mercury Prize prize money to charitable organizations.
Back when they won the award in 1996 for their album the album, vocalist Cocker declared that the group would give their winnings to the organization War Child.
In 2002, musician the artist split her prize between multiple organizations, like the NSPCC and a charity for Sickle Cell.
"Additionally, I contributed a £1,000 to my local community centre, to their gymnastics class, because I did gymnastics when I was growing up and they needed new equipment," Ms Dynamite told the media.
Two years ago, they contributed their winnings to the local youth club that supported their act, alongside other independent music bodies.
And the 1994 recipients the group donated their winnings to a MS organization after a friend was found to have the condition.
"Winning was sufficient," stated artist the singer. "The money was the extra but we didn't need the cherry, because we had the cake. So our success affected another person's life."
Recently, the Music Venues Trust shared it had rescued two small stages in south-east England, by transferring them to community ownership.
One venue in that area and The Croft in Bristol were purchased under the public acquisition program, which is backed by the arts council and supporters who buy "stakes" in the venues.
