The artist has handed over the full amount of his twenty-five thousand pound honor cash to the Music Venues Trust, which works to protect the UK's independent concert spaces.
The star was awarded the award on mid-October as his new release his work was named the best record of the previous year.
He has opted to hand the money over to the trust, in appreciation of the essential function small stages played in his early career.
"As an artist couldn't be pursuing my current career if it weren't for all the performances I played around the area, and beyond, when I was starting out," stated the artist. "These venues are legendary, but they are in difficulty."
From early 2023 onward, at least 150 of these spaces have shut down – roughly 16 percent of the total UK scene.
Over the past year, top acts including Pulp, Coldplay, Katy Perry and Ed Sheeran have all backed the trust in its initiatives to support the industry, by applying a minor surcharge to their ticket prices, which goes to help smaller concert halls.
Fender also joined in, raising more than £100,000 on his recent tour to help 38 grassroots venues across England, Scotland, and Wales.
These funds supported locations that were confronting imminent closure due to challenges stemming from flooding, fire incidents and bereavements, as well as regulatory hurdles, conflicts and noise complaints.
Additional spaces were granted funding support in improving infrastructure and gear that helped artists and fans.
"The idea that revenue from shows in large arenas backs the local stages, where it kicks off for musicians like me, is just common sense," the star has stated.
He is not the first artist to give his Mercury Prize winnings to good deeds.
When Pulp received the trophy in the mid-90s for their album the album, lead singer Cocker announced that the act would give their winnings to the charity War Child.
In 2002, musician Ms Dynamite split her bounty among several organizations, such as the NSPCC and a Sickle Cell organization.
"And I donated a grand to the center, to their classes, because I did gymnastics when I was younger and they required updated gear," she shared with outlets.
In recent years, the band donated their funds to the community center that nurtured their group, alongside other local music groups.
Also winners that year the group donated their prize to a multiple sclerosis charity after a acquaintance was found to have the disease.
"Winning was sufficient," said vocalist Heather Small. "The money was the cherry on top but we didn't need the cherry, because we had the cake. So our winning impacted another person's life."
Recently, the trust announced it had saved several small stages in that region, by placing them under local control.
One venue in Southampton and The Croft in Bristol were bought under the Own Our Venues initiative, which is supported by the arts council and music fans who acquire "shares" in the buildings.
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